MORE than 100 jobs will be lost as defence manufacturer BAE Systems prepares to move work from Tyneside to Shopshire.
The company says it has no choice but to cut the 400-strong workforce as it refocuses its operations.
It is thought the jobs will be gone by 2012, with an uncertain future left for the Scotswood Road factory, which has yet to secure any further contracts past 2013.
Staff were told last year that the firm has missed out on the £1bn deal to make British Army Fres Scout armoured vehicles. They are currently working on the Terrier combat engineering vehicle.
Yesterday workers at the old Vickers factory were told that a Wolverhampton site would be closed down, kick-starting a process of merging jobs at the nearby Telford site in Shropshire.
BAE would not confirm speculation that the Newcastle site is set to close down fully by 2013, saying its latest announcement did not mean there was no a future for the factory.
In a statement it said the vehicles side of the business will now focus on completing current manufacturing programmes and providing support services to the British Army and other international customers.
Jan Söderström, MD for BAE Systems’ Vehicles business said: “We have consistently said that we must reduce costs to remain competitive and secure a future for the business.
“We are creating a more efficient business to ensure we are the right size and have the right mix of skills to meet current and future customer needs.
“We regret the impact that this will have on our employees. We will work with employees and trade unions to explore ways of mitigating these proposed job losses, and do everything we can to support our people throughout this process.
“We will continue to meet all planned deliveries to our customers throughout this transition.”
Reacting to the announcement, Newcastle Central MP Chi Onwurah said: “This is bad news for Newcastle and my thoughts are with the employees of BAE Scotswood and their families, having to deal with an uncertain future.
“But the whole region is affected by the loss of such highly skilled jobs. BAE’s announcement is a direct result of procurement decisions made in Whitehall.
“We need Government procurement which supports and secures our future skills base in the region, rather than undermining it.”
Newcastle Council has said it will be looking to try to safeguard the site’s future.
Director of policy Andrew Lewis said: “The city council regrets the loss of jobs arising from BAE’s announcement and is concerned that some of the job losses could be from the Newcastle plant.
“We have been in close touch with BAE and other partners to ensure we do all we can to support the staff concerned.
“With their skills and experience of advanced manufacturing, BAE’s employees are a great asset for the economy of the North East, and we and our partners will work together to retain them in the region.
“We will also want to ensure that their unique site continues as a centre for business activity and jobs long into the future.”
In March last year, BAE confirmed it was cutting 217 of the 650 jobs at Newcastle after it lost out to General Dynamics in the bidding for the £1bn British Army Fres Scout armoured vehicles contract.