11:04am UK, Wednesday October 18, 2006

TVR is to close its UK factory in Blackpool with the loss of 260 jobs.

Britain's biggest independent car maker will cease production at the plant in six months.

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Half the firm's staff had already been told to stay home after production plunged from 12 cars a week to just two.

The Transport and General Workers Union said it was told the company would keep a presence in the UK but would be relocating production.

A mass meeting of workers next week will decide on the union's next move.

Andy Robertson of the TGWR said: "We are devastated by this news which has stunned the workforce."

A company spokesman denied the company was shutting down its UK operations.

"We are not closing, we are just moving production," he said.

The spokesman said the firm was looking for a smaller site with better facilities.

The only redundancies confirmed involved 71 temporary lay-offs, he said. He could give no guarantees about future job numbers.

The firm, founded in 1947, was bought two years ago by 23-year-old Russian millionaire Nikolay Smolensky.