A trade union leader has called on the Government to step-in if need be to protect manufacturing jobs in the Midlands in the wake of the collapse of Caparo Industries.
More than 1,700 jobs, most of which are in the Black Country, remain in the balance after the engineering group, which comprises 13 firms in the region among others, .
The firm, which is owned by Labour peer , produces a number of steel products. It has struggled after seeing the price of steel fall with Chinese imports flooding the market.
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A spokesperson for PwC said fears all jobs would be lost were unfounded and promised a clearer view would emerge in the days ahead.
Matt Hammond, lead administrator and partner at PwC, said it remained business as usual for staff as a review gets underway.
Gerard Coyne, West Midlands regional secretary of Unite the union, said Caparo Industries’ operations in the Midlands were among the most successful in the group and hopes the Midland businesses which employ around 80 per cent of Caparo’s staff can be kept going until a buyer is found.
He said the Midland businesses, many of which supply to the automotive and aerospace sectors, were performing well and had full order books but had been hit by a ‘tsunami’ taking place in the steel industry.
He said: “This is a bitter blow for the employees in Caparo. They have clearly given a huge commitment in their working life and their concerns now for their future make it very difficult for them.
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“We would hope that some parts of the group are quite viable and a buyer can be found for them.
“We realise this started with Tata Steel and it has now turned into a tsunami for the West Midlands because of the cash being burned in the business. Caparo companies are very specialist.”
Mr Coyne said warnings had been given to the Government and added that if need be it should step-in to help save jobs.
“We warned the Government at the steel summit last week that decisions needed to be taken - otherwise there would be consequences,” he said. “Here we are seeing the consequences.
“The employees of this company are looking for the Government to step up to the mark and for a strategy to be put in place.
“This is a body blow again in terms of the regional economy and we have real concerns.
“That is why the Government must step-in and do the right thing.
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“There are bits of this company that are very successful with full order books.
“The Government has done it previously a few years back with MG Rover when it stepped-in and paid employees’ wages for a week to see if a buyer could be found.
“Giving that breathing space and keeping continuity is really important for the succession of the business and for buyers to come forward.
“The worst thing that can happen is for parts of the business to be mothballed.
“The irony is that 80 per cent of the business in the West Midlands is automotive and aerospace - it is the 20 per cent elsewhere that has dragged the company down.”
The businesses which have gone into administration are Caparo Industries, Caparo Engineering, Caparo Steel Products, Caparo Vehicle Products, GW 957, Bridge Aluminium, Material Measurements, Caparo Precision Tubes, Caparo Precision Strip, Caparo Vehicle Technologies, Caparo Tube Components, Caparo Modular Systems, Caparo Advanced Composites, Caparo Accles & Pollock, Caparo Tube Components and Caparo Atlas Fastenings.
The 13 operations in the Midlands are located in Oldbury, West Bromwich, Wednesbury, Willenhall, Cradley Heath and Leamington Spa.