A car parts firm has announced it will close its factory in South Wales with the loss of 125 jobs.
Hi-Lex Cable System Company, based in Port Talbot, manufactures window and car door parts for companies including Ford and Honda.
The company said in a letter sent to customers on Monday that the site would close in 2021 due to an expected “significant reduction in sales”, with Honda’s Swindon plant due to close the same year.
Hi-Lex Corporation regrets the need for the decision to restructure its operations, but it is based solely upon a significant reduction in the sales forecastHi-Lex
The letter said: “At a meeting held in Takarazuka, Japan, on October 12, the board of directors of Hi-Lex Corporation discussed and agreed a restructure of its operations in Europe.
“As a result of the discussion, the decision was taken to close the Hi-Lex Cable System Co. Ltd facility in Port Talbot, South Wales, in 2021 with all its remaining business to be transferred to the Hi-Lex facility located in Retsag, Hungary.
“Hi-Lex Corporation regrets the need for the decision to restructure its operations, but it is based solely upon a significant reduction in the sales forecast at HCS (Hi-Lex Cable System), from 2021 onwards.
“Hi-Lex will now contact all of our supply chain partners to discuss and agree plans to meet the needs of our customers up to the closure of the HCS facility.”
The company’s managing director Adam Glaznieks said the plant’s 125 employees were informed of the decision on Monday, and were told the company “did not anticipate any redundancies in the next 12 months”.
Mr Glaznieks confirmed car giant Honda’s plans to close its UK factory in 2021, with the loss of 3,500 workers, had contributed to the reduced sales forecast.
He said: “Honda are a major customer of Hi-Lex therefore it is part of the significant reduction in sales forecast from 2021 onwards.”
The leader of Neath Port Talbot Council, Rob Jones, said attempts would be made to support workers, but said the firm’s closure would be “keenly felt” in the area.
He said: “This auto parts firm has been an important part of Neath Port Talbot Council’s economy for more than 20 years and the impact of its closure will now be keenly felt in this area.
“We will try to support Hi-Lex workers wherever we can into new employment and will also work with the Welsh Government and other partners to mitigate the effects of these job losses on the workers themselves and the local area.”
Bethan Sayed, the Plaid Cymru AM for South Wales West, blamed the closure on Brexit, saying it was “driving uncertainty in the automotive industry”.
She said: “The Welsh Government needs to recognise that if the Welsh automotive industry is to thrive in the future, it must invest time and money, as other governments have done, to ensure the industry innovates. We’ve seen very little of that happening thus far.
“But I have to say that it cannot be denied that Brexit has played a role in this closure. It is driving uncertainty in the automotive industry, and now we see 125 Welsh jobs moving from Wales to Hungary, which is in the EU.”
The Japanese owned Hi-Lex Cable System Company was the first firm to set up on the Baglan Energy Park when it opened in 1996.
Bosses told council officials the closure was related to the fact Volvo’s new engine will have electronic transmission and will not require cabling, as well as the closure of Honda’s Swindon site which made up around 40% of its business.
Hi-Lex also said its business would be affected by the remaining work for Ford Europe being transferred to Hungary.