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Pressures on the car parts supply chain erupted today with the appointment of Jim Tucker and John Hansen of KPMG as joint administrators for car component maker Visteon UK (VUK).
VUK employs 610 people in three factories in Basildon, Enfield and Belfast. Over 560 redundancies were being made today with the remaining employees assisting the administrators in the wind-down.
KPMG said Visteon UK has not been profitable since its incorporation in 2000 and VUK’s reported losses since had totalled £669 million.
It added that various restructurings were attempted by VUK but “unfortunately none have been successful”.
The administrators said VUK has been dependent on US parent Visteon Corporation to fund its losses.
Corp is VUK’s biggest creditor and is owed £400 million. Visteon Corp has informed VUK that it can no longer support the business.
Tucker said: “The entire automotive supply chain has been under pressure for a number of years. In the current economic downturn, car sales have dropped dramatically, which has caused further severe pressure on parts suppliers.”
A separate UK company, Visteon Engineering Services Ltd, is unaffected by this appointment and continues to trade as normal.