Bentley is to cut up to 1,000 jobs under a “voluntary release programme” and cannot rule out future compulsory redundancies, the luxury carmaker has announced.

The Crewe-based company said significant effects on its short-term financial outlook means that with “deepest regret” it has informed its 4,200 workers of a programme to significantly reduce the size of the organisation.

A statement said: “Bentley is in the middle of a major change programme started in 2018, driving for consistent financial resilience through rapid productivity improvements across the business.”

The programme led to profits and a record performance in the first quarter of this year, said Bentley, adding: “Although organic growth was the planned solution for the remaining restructure challenge, this was clearly derailed by the impact of the pandemic.

“With this considerable forecast reduction to future revenues, Bentley has hastened plans carrying out a comprehensive review of its cost and investment structure and as the last resort, as with any organisation, the people costs and structure.

“Steps had already been taken to cut or delay unnecessary spend without impacting future product plans. Recruitment was stopped, contractors were released across all business areas, pay was frozen and up to 66% of colleagues at peak were placed on furlough.

“One further clear conclusion was that an urgent reduction in the workforce was unfortunately required.”

Unite said the announcement was “another heavy blow” for the automotive industry following a series of job losses caused by the Covid-19 crisis.

National officer Steve Bush said: “Bentley is a name known around the world for the quality of its vehicles, thanks in large part to the expertise of this highly dedicated and superb workforce.

“To ask 1,000 of them to leave the company, albeit on voluntary terms, is heartbreaking for the workforce and their communities. We are determined to support our members during this process to do what we can to mitigate the jobs lost.”

The announcement was made just weeks after Bentley resumed production in Crewe.