Bus manufacturer Alexander Dennis has launched a consultation on plans to cut 650 jobs following a “significant fall” in demand for new vehicles in the UK.

The company plans to cut 200 jobs at its site in Guildford, Surrey, 160 in Falkirk, 90 in Scarborough and 200 in support functions across its bases.

Managing director Paul Davies said: “We have no choice but to implement these tough decisions to protect the company’s future health.

We continue to call upon the UK and Scottish governments to urgently introduce meaningful support to facilitate demand for new buses and coaches

“We remain confident that the situation will improve in time, and we are well placed to take advantage when that happens, but right now we have to adjust to our new economic reality.

“We continue to call upon the UK and Scottish governments to urgently introduce meaningful support to facilitate demand for new buses and coaches, not only to prevent further damage to UK bus and coach manufacturing that could threaten additional production sites, but to help build back better with a green recovery that delivers cleaner air for our towns and cities.”

Unite’s Scottish secretary Pat Rafferty described the announcement as “devastating”, adding the union will not allow the “savage cuts” to go unopposed.

The company, ADL, said the job losses were in response to a significant fall in demand for new buses and coaches in the UK as a result of the coronavirus pandemic.

It said: “The dramatic fall in demand for new buses and coaches as a result of lockdown, social distancing and low passenger numbers has left ADL with no alternative but to adjust its business to the current economic situation.

“Since the announcement on July 27 of a restructuring programme that puts up to 650 jobs at risk across all of the company’s UK facilities, ADL has continued its dialogue with the UK and Scottish Governments and other stakeholders.

“However, there remains no immediate visibility of the stimulus funding urgently required to support operators to place orders, making it necessary to begin the formal consultation on the proposed changes.

“ADL remains firmly committed to working with its customers and supporting the bus and coach operating industry, which is battling an unprecedented crisis.

“The restructuring programme is designed to adjust current capacity without compromising the company’s ability to respond to a resurgence of demand in the future.”

ADL said it intends to transfer chassis production to its Falkirk factory, affecting around 200 employees in manufacturing and operational support roles at Guildford.

Non-manufacturing functions including engineering, test and development and aftermarket will continue to be based at the Guildford site.

Mr Davies said: “The Dennis brand is of huge significance to the company, with its proud history and heritage of automotive innovation dating back to its inception in 1895.

“We will fight hard to protect this legacy and will continue to invest in our chassis product range, which will continue to be engineered in Guildford.”

ADL said it was seeking voluntary redundancies to reduce the number of compulsory job losses.

Mr Rafferty added: “There are a number of measures which the Scottish and UK Government can and must enact with immediate effect. This includes the UK Government bringing forward its order of 4,000 new low emission buses and the Scottish Government implementing the Just Transition Commission’s recent recommendation that £500 million be invested in the nation’s transport infrastructure including the manufacture of green buses.

“Unite is clear that any public money including new orders must be conditional on the company retaining jobs and keeping work in Scotland, and across the UK.

“The blame for this situation ultimately lies with the parent company based in North America. If these premature and needless job cuts go ahead then it will have a substantial impact on the nation’s green manufacturing capacity and make a mockery of any just green recovery.”

Unite assistant general secretary Steve Turner said: “While the coronavirus crisis has undoubtedly impacted ADL’s short-term operations following a collapse in orders from UK bus operators, the firm’s Canadian parent company NFI has exposed the true extent of its betrayal of UK workers, their families and communities.

“Pre-Covid plans, identified by Unite following disclosure of information requests, are now being accelerated to use the pandemic as an excuse to bring forward the ending of production at Guildford and attack jobs across the group while outsourcing work abroad in order to line shareholder pockets.

“The fact that all this is being done after the company took full advantage of UK taxpayers’ money through the job retention scheme, and after our help has been sought to secure Government funding for advanced manufacture of green buses, is a gross betrayal of a loyal, world-class workforce.”

Responding to Unite’s claims of outsourcing work to Turkey, the company said this was only under consideration for a Berlin contract, adding: “The arrangements for the manufacture of this contract are entirely disconnected from the actions we are being forced to take in the UK as a result of the coronavirus pandemic.

“The ongoing lack of clarity over the future trade relationship between the UK and the European Union threatens import tariffs and other costs which would make this and potential other European contracts commercially unviable if manufactured in the UK.

“As in other parts of the world where UK manufacture is not feasible, we have had to make contingency plans to ensure the contract remains viable.”

Jamie Hepburn, Scottish Government Business Minister, said: “I am very saddened to hear of the redundancies planned at ADL.

“The Scottish Government stands ready to support any staff affected through Partnership Action for Continuing Employment, our initiative for supporting people affected by redundancy.

“Yesterday, we launched a £9 million Scottish Ultra Low Emission Bus Scheme to help bus operators invest in ultra-low emission vehicles and to support the supply chain.

“We continue to work with ADL to explore all possibilities for keeping jobs in Scotland.”