Seat and Ford to trim workforces

VW has owned Seat since 1990

Spanish carmaker Seat and US giant Ford are both set to reduce their European workforces to save costs.

Seat, which is owned by Germany's Volkswagen, plans to cut more than 1,340 jobs, about 8% of its workforce.

Ford's German operation is also facing a shake-up, with the company planning to cut 1,200 jobs by the end of 2005.

VW and Ford are among a number of leading carmakers having to restructure their businesses to address high production costs and weak sales.

Failed talks

Both companies have warned they will cut thousands of jobs in an effort to become more efficient.

Seat, which employs about 16,300 staff, said it had failed to reach agreement with unions about proposed cost-savings measures.

Under Spanish law, the Barcelona-based firm must seek approval for any job cuts from the regional government.

Ford's Cologne plant will suffer the bulk of the German cuts, with 1,000 jobs expected to go over the next two months.

Most of these are expected to be on a voluntary basis, with affected workers receiving redundancy pay and retraining.

Thousands of jobs are expected to be lost in Germany's car industry over the next few years, at a time when the country is already suffering high levels of unemployment.

DaimlerChrysler recently said 8,500 jobs could go at Mercedes while VW has warned of further jobs losses in its home market.