Bentley To Stop Production In March, April

Luxury automaker halting production at its manufacturing plant in central England for seven weeks as Britain's car industry continues to suffer amid plummeting demand.

LONDON (AP) -- Luxury automaker Bentley said Thursday it was halting production at its manufacturing plant in central England for seven weeks as Britain's car industry continued to suffer amid plummeting demand.

Bentley Motors Ltd. said it would stage a staggered shutdown of its manufacturing operations at Crewe, about 170 miles (275 kilometers) northwest of London, beginning in early March and lasting until April.

Spokesman Mike Hawes said a global drop in demand for cars had forced the company's hand. "We're like a number of other motor manufacturers facing similar challenges," he said.

He declined to say how much the company, which is owned by Volkswagen AG, hoped to save by stopping production. The Crewe plant produced 7,600 of the top-end cars last year, a 24 percent drop on the year before. Bentleys typically retail for anything between 125,000 and 250,000 pounds ($170,000 to $340,000) each in the U.K.

Like its counterparts across the globe, the British automotive industry has been badly hit by the global financial crisis. Figures released Thursday by the Society of Motor Manufacturers and Traders, or SMMT, showed vehicle production in Britain slumped by nearly half in December from the same month the year before.

The trade group said nearly 48 percent fewer cars were made in December 2008 compared with the previous year, meaning that in 2008 as a whole car production dropped by almost 6 percent.

Its not just car makers who are suffering: Optimism in the country's manufacturing sector as a whole has slid to a near 30-year low -- despite a rapidly falling pound.

In its quarterly assessment of the manufacturing sector, the Confederation of British Industry found that 70 percent of companies are less optimistic than three months ago, while just 6 percent are more positive. The figures were the worst since July 1980, when Britain was mired in a deep recession.

The CBI said demand for manufacturing goods has fallen sharply in the last three months with more businesses reporting a drop than at any time since July 1991.

The confederation said the outlook for the next three months is grim despite the big falls seen in the pound, particularly against the dollar and the euro. A falling currency should make exports cheaper but the faltering U.S. and European economies are more than offsetting that.

"Most firms expect conditions to get even worse, with further falls in orders expected, leading to more job cuts," said Ian McCafferty, the CBI's chief economic adviser. The CBI forecast that almost 50,000 manufacturing jobs were lost in the fourth quarter of 2008 and 60,000 could be lost in the first quarter of 2009.

Associated Press Writer Raphael G. Satter contributed to this report.

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