Ford says its decision to axe GBP81m (US$108m) from an initial GBP181m budget allocated for engine development in South Wales will not impact jobs, although the government in Cardiff is to hold the automaker’s feet to the fire ensuring its investment conditions are upheld.

The devolved power in Wales funnelled GBP15m to the Bridgend Dragon engine plant on condition Ford continued to employ 500 people, with Cabinet Secretary for Economy, Ken Skates saying he recognised the concerns workers and unions had.

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“While I welcome assurances from Ford the operational changes they have announced today are not expected to affect workforce numbers in the short to medium term, I recognise the concerns workers and unions at the plant have,” said Skates in a statement sent to just-auto from the Welsh capital of Cardiff.

“We understand this will mean a lower volume of the Dragon Engine being produced initially, however, the Bridgend site will have capacity to ramp up volumes when  global demand increases. It’s important the company keeps workers at the plant briefed on the position as we move forward.”

Ford insists it does not envisage any reduction in employment numbers at the plant, maintaining it has the right staffing levels to meet its short and medium-term requirements, but cautions it cannot predict future market trends.

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“No plant can guarantee – we simply can’t control supply and demand,” a Ford spokesman told just-auto. “Manufacturing plants are at the mercy of global demand.

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“As things stand, that is the situation. All plants have to be competitive. The GBP100m is still a very major investment. The way investment is made, we can upscale capacity pretty quickly.”

Ford said it was in consultation with unions surrounding its Bridgend decision, with the Welsh government echoing it would also cooperate with labour bodies to discuss the issue.

“The Welsh Government  will be working very closely with senior executives from Ford Europe, the management team and Unions at Bridgend to understand the implications of this announcement and we will continue to support the workforce as well as the company as much as possible,” added Skates.

“It is worth noting one of the reasons for the decrease in global demand of the Dragon engine is the success of the Eco-Boost engine, which is also made in Bridgend.”