The Japanese industrial giant NSK has announced plans to close its County Durham manufacturing facility, threatening around 350 jobs in a major blow to North East employment.
The Peterlee plant faces closure as the company looks to withdraw from loss-making operations.
The automotive components manufacturer confirmed it has begun formal consultations with trade union officials about the proposed shutdown.
The facility specialises in producing bearings vital for vehicle steering systems and wheel assemblies.
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NSK Europe said: "Persistent challenges in the profitability of locally manufactured products" had driven the decision.
"We will continue discussions with stakeholders and provide support measures for affected staff if the closure proceeds, which is expected to be completed no later than March 2027."
The Peterlee operation has been part of British manufacturing since its establishment in 1976.
The site forms part of NSK's wider European network, which includes facilities in Newark, Nottinghamshire, along with three additional plants in Germany and Poland.
NSK supply parts to Nissan's Sunderland plant
|GETTY
Among the plant's customers is the Japanese carmaker Nissan, which runs major vehicle production operations at its Sunderland site.
This relationship highlights the interconnected nature of Britain's automotive supply chain and the potential ripple effects of the proposed closure.
The company said it was still assessing the full impact on business performance. NSK said it remained in talks with affected parties while the consultation process continues. Manufacturing in Britain has faced growing pressures, especially around energy costs.
However, the Peterlee facility operates solely on wind-generated electricity, setting it apart from competitors reliant on traditional power sources.
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The announcement will be a blow felt by the local community in Durham
| GETTYThe proposed closure is part of NSK's broader restructuring to remove unprofitable ventures from its operations. The move reflects the challenges facing component suppliers in an increasingly competitive global market.
The company has not yet given full details on redundancy packages or redeployment options for the workforce. Union representatives are expected to negotiate terms for affected employees during the consultation period.
The closure would be a setback for the North East’s manufacturing sector, particularly given the plant’s role in supplying Nissan’s Sunderland operations.
Nissan’s production complex relies on local components to maintain its competitiveness. The development raises questions about the resilience of Britain’s automotive supply network, already adapting to post-Brexit trading rules and the transition to electric vehicle production.
Critics have hit out at net-zero targets as a drag on productivity
| PALosing a long-standing supplier could complicate Nissan’s supply chain and impact the wider regional economy.
If confirmed, the Peterlee plant’s closure would mark another chapter in the ongoing transformation of British manufacturing, as traditional suppliers struggle against international competition and shifting industry demands.
Operations could cease by March 2027, giving more than a year for consultation and possible alternatives to be explored.
Trade union discussions are underway, though details on workforce representation have not been released. Despite the plant’s use of renewable wind power, this sustainability advantage was not enough to overcome profitability challenges.