THE UNIPART Group has shocked its 500 employees by announcing that its loss-making Ketlon factory in Paddock Wood is up for sale.

Unipart said the business would be phased out progressively during 2002. However, if no buyer is found, it warned that trading will cease and the factory will close by the end of the year.

It said the company would work closely with the Employee Forum, the employees’ representatives.

“If Ketlon is not sold, wherever possible, we will be seeking to redeploy employees to other areas of the group.

“Regrettably, where this is not possible, we will be offering a redundancy

package and outplacement support to employees to help them find alternative

employment.”

The company said that despite difficult market conditions all its manufacturing sites were profitable with the exception of its machining business in Kent.

It blamed tight margins, declining volumes and low proportion of added value in in machining operations, coupled with vulnerability to global sourcing due to the continued weakness of the euro.

All these factors had “influenced the group to make a strategic decision to exit the machining business".

Ketlon manufactures and assembles gears, shafts and sprockets for UK, European and US automotive companies such as DaimlerChrysler, Ford, BMW, Rover and JCB.