Japanese car giant Honda is to cut 800 jobs at its UK factory after a slump in demand across Europe.
Workers at the firm's plant in Swindon, which employs 3,500, were told the grim news as they arrived this morning.
Honda, which has been making cars in the UK since 1992, has never had job losses before in this country, but it said demand for cars in Europe, including Spain, Italy and Greece, had fallen by a million in the past year.
The company gave the statutory 90-day notice of consultation and said it would seek to avoid compulsory redundancies.
Ken Keir, executive vice president of Honda Motor Europe, said: "Sustained conditions of low demand in European markets make it necessary to re-align Honda's business structure. As such, Honda of the UK Manufacturing (HUM) will enter into formal consultation with its associates to consider these changes and the proposal that it will reduce the workforce by 800 associates by spring 2013.
"Honda remains fully committed for the long-term to its UK and European manufacturing operations. However, these conditions of sustained low industry demand require us to take difficult decisions. We are setting the business constitution at the right level to ensure long-term stability and security."
Honda said individual discussions will be held with workers at the Swindon factory following the announcement, while union officials have been briefed about the plans.
Around 150,000 cars were built last year in Swindon, which has an annual capacity of 250,000. A third of the cars are sold in the UK, with the rest being exported to 26 countries, mainly in Europe.
Honda builds the Jazz, Civic and CR-V models in Swindon and has grown in size since it first started manufacturing in the UK, investing more than £2bn.
The Society of Motor Manufacturers and Traders (SMMT) reported earlier this week that sales of new cars in the UK topped two million last year, the best since 2008.
Honda announced a £267m investment programme at Swindon last September, creating 500 new jobs because of an expected increase in demand as well as a new diesel engine line. Business Secretary Vince Cable visited the plant to mark the news.
Honda said the expected increase in demand had not happened so it now predicted that annual production would remain at 150,000 for the next three years.
A Department for Business, Innovation and Skills spokesman said: "This will be a bitter blow to the workforce and the local area and we will be working with local partners to minimise the impact of the job losses.
"Times are tough in the European market but the automotive industry remains a major success story for the UK. Over the last two years global manufacturers including Nissan, JLR and BMW have invested £6bn in the UK, safeguarding and creating new jobs."
Unite national officer Tony Murphy said: "This is a hammer blow to UK manufacturing and to Swindon where Honda is a major employer. The reality is that over 1,000 jobs are going at Honda – it's a disaster for manufacturing in the UK and for the local economy. It's a tragedy for our members and their families. There's no doubt these cuts will have a significant knock-on impact on the supply chain, and on local shops and services.
"Unite will oppose any compulsory job losses. We expect Honda to negotiate meaningfully with the union in order to mitigate the impact of these cuts. Unite will be meeting with our local union reps in the coming days to discuss the company proposals."
Unite said more than 1,100 jobs will be lost as the company recently announced 325 job cuts to temporary workers at the Swindon site.