Ford has told the United Kingdom government it is to close its Jaguar plant in Coventry with the loss of 1,600 jobs, it was claimed on Thursday, the Birmingham Post said.

The paper said it is also understood a number of organisations have been briefed that the Brown's Lane plant will close as part of Ford's tough global cost cutting.

"An impeccable source" reportedly told The Birmingham Post that a decision has been taken at corporate level in Detroit that the factory will close, but it does not have an accompanying timescale.

The source told the newspaper: "Brown's Lane is definitely going to shut and the government knows about it. The plant is in dire straits.

"Ford in Detroit is saying it has one Jaguar plant too many and that plant is Brown's Lane."

A spokesman for Jaguar told the Birmingham Post on Wednesday night that suggestions the plant was closing was "speculation".

Jacqui Smith, Trade and Industry Minister, and a spokesman for the Department for Trade and Industry told the paper: "No decisions have been made."

The Birmingham Post said hardly any investment has gone into Brown's Lane in recent years and pressings for the Jaguar-XJ car, now built with an aluminium body, come from another plant at Castle Bromwich.

The newspaper noted that Sir Nick Scheele, president and chief operating officer at Ford and number two in the company which owns Jaguar, denied the plant was closing when he was asked about its future at the recent Tokyo Motor Show.

But to announce the closure of the plant at present would add huge costs to Ford's accounts and its stock price would fall further and put an additional burden on the company, the Birmingham Post said.