THE crisis gripping the North-East car components sector deepened last night with the closure of a seat belt manufacturing plant and the loss of up to 150 jobs.

TRW's Cook Way plant in Peterlee, County Durham, is to merge with the company's other factory at nearby Mill Hill.

Although the 500-strong workforce at both sites have been issued with 90-day notices - the statutory notification of redundancy - the vast majority are expected to keep their jobs.

However, bosses have not ruled out compulsory redundancies.

Management blamed the world recession, the strong pound and the slump in the UK automotive industry.

The announcement comes a few days after Japanese component manufacturer NSK announced it was planning to close its steering column plant in the town.

At the time, analysts predicted more blood-letting within the industry - the result of Britain's strong pound and the decision by car companies to buy more components from Europe.

Parts suppliers in the region are feeling the pinch because Nissan is planning to do more business with firms in the euro-zone. French suppliers are also competing aggressively for contracts as a result of the Japanese company's merger with Renault.

John Haynes, TRW's human resources director, would not be drawn on the Nissan connection, but confirmed the world recession and strong pound played their part in the decision.

He said: "We have consolidated the two plants so all operations will now be under one roof. Therefore, seat belt production will be moved Mill Hill where we manufacture airbags.

"There may be some job losses - we are looking at more than 100 - but we are hoping to minimise that."

Union members were left nonplussed yesterday at the lack of dialogue between them and company bosses.

The engineering union, the AEEU, said that although it is not recognised at the plant, it still expected to be contacted by TRW.

Tom Allison, AEEU regional officer, said: "The mood there will be grim, I imagine."

The Cook Way site will be phased out during the next year, as the 12-month lease comes to an end. It brings to an end ten years of production at the plant. The Mill Hill site has been operational since 1996.

Bosses said they plan to double the size of the remaining plant in the long term.

The news came as latest statistics revealed a further slump in UK manufacturing.

The Office for National Statistics said that during October there were significant falls in output in the transport equipment industries, hit by a fall in the aerospace and car manufacturing industries and in the electrical and optical sectors.