Page last updated at 16:39 GMT, Wednesday, 4 March 2009

560 jobs threatened at two plants

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Problems accelerated towards the end of 2008, with demand plunging 60%

More than 560 jobs will go in south Wales after an aluminium factory and a car parts manufacturer said they had been hit by the economic downturn.

Novelis said its aluminium sheet mill in Rogerstone, Newport, will close by the end of April with 440 job losses.

The company said there had been a "significant decline in orders".

Musashi Auto Parts also blamed an orders slump for the planned closure of its plant at Blackwood, Caerphilly, which employs 124 people.

Meanwhile, a pharmaceutical firm says it will create 133 jobs in Tredegar, Blaenau Gwent over the next five years.

Aluminium giant Novelis said a viable plan for keeping open its UK rolling mill had not emerged despite a 90-day consultation with staff.

General manager Oliver Picht said the "goalposts have continued to move" as the workforce "prepared to take far-reaching steps" to adapt to a "significant decline in orders".

He said: "The order book is still dropping and the proposed measures can't address that sufficiently."

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BBC News is tracking where jobs have been created and lost around the UK

The firm, which employs around 12,500 people in 11 countries, said said existing customer orders at the Wales site will be fulfilled.

The firm had previously said it was expected to lose 8m this financial year.

There has been an aluminium plant at the site for 70 years.

It was previously known as Alcan, before a spin-off company was created in 2005 and then two years later it was acquired by Mumbai-based Hindalco Industries.

The plant produces aluminium sheet, which is supplied either as coils or cut sheets to customers in the transport, engineering and packaging sectors.

"The Rogerstone team made every effort to adjust the operating model and costs to reflect the decreasing order book," said Arnaud de Weert, president of Novelis Europe.

Location map
The two plants are 15 miles apart

"Unfortunately a sustainable solution could not be found. We thank the employees for their constructive approach in the face of these challenges."

"This has been a very difficult decision to make but like many companies we must adjust to the economic realities of today. "

The leader of Newport City Council, Councillor Matthew Evans, said the announcement was a "devastating blow for all those who work at Novelis and their families".

"The factory has been a major employer in Newport for many years and has benefited enormously from the first-class service its loyal employees have given it," he said.

"This is a further blow, not only to Newport, but to the entire UK manufacturing industry.

"Despite the economic downturn, increasing employment opportunities in the city remains one of our priorities and we will continue to work to encourage investment in Newport.

'Very disappointed'

In Blackwood, Japanese-owed Musashi said its Wales manufacturing site has been hit by the slump in orders.

Site managing director Graham Hill said the firm had begun a 90-day consultation process with unions over the redundancies, with the site expected to shut by the end of the year.

He said: "We're obviously all very disappointed.

"We've worked very hard over the years but unfortunately this recession is having an impact on us as on many other people."

The Musashi plant on Hawtin Industrial Park, Pontllanfraith, opened in July 1993.

Musashi range of gears
Car parts firm Musashi is expected to close its site by the end of the year

The GMB union said it was in talks with the firm to try to negotiate redundancy packages for staff.

Official Gareth Morgan said the union was also in talks with the Welsh Assembly Government over possible alternative employment options.

However, Penn Pharmaceutical Group, which employs nearly 250 people at Tafarnaubach Industrial Estate, Tredegar, said it was launching a 12m expansion programme.

It said the work would create 133 jobs and safeguard the future of a further 100.

Backed by the Welsh Assembly Government's Single Investment Fund, Penn plans to extend its current facilities where the company currently employs nearly 250 people.

Deputy First Minister Ieuan Wyn Jones said: "Penn Pharmaceuticals' latest investment demonstrates that - despite the general economic downturn - some key companies in vital sectors are confidently investing in the future and are creating precisely the kind of skilled jobs that the Welsh economy needs."

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FROM OTHER NEWS SITES
South Wales Argus NOVELIS CLOSURE: Site produced metal for Spitfires - 23 hrs ago
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