Three out of four auto parts makers in the West Midlands have had to cut staff as they struggle to cope with the recession and the slump in demand for cars, a new report reveals.

And four out of 10 component manufacturing companies in the region expect to have to axe more jobs this year. At the same time the report found too many firms relying on Jaguar Land Rover for all their work.

West Midlands vehicle parts firms saw a 37.2 per cent drop in their production in 2009, forcing one in four to implement extended shutdowns of their factories.

The study was carried out by the Society of Motor Manufacturers and Traders (SMMT) in partnership with Accelerate, the West Midlands body set up to help car parts companies.

It found 30 per cent of all suppliers depended on Jaguar Land Rover for much of their auto business, while nearly all said at least half of their orders came from within the UK and 35 per cent supplied purely to customers in the West Midlands.

The study also found what Accelerate called “a worrying over-reliance on one customer”.

Rachel Eade, programme manager for Accelerate, said: “This study demonstrates that the impact of the recession is far wider reaching than we originally anticipated with 75 per cent of respondents indicating they had reduced their headcount.

“There were also reports of short-time working, wage freezes, reduced pension contributions and 25 per cent of companies implementing extended shutdowns.

“A lot out of our suppliers are still over reliant on one big customer, with JLR and Ford topping the list. In short, the case for diversification within the auto sector and into other markets has never been so relevant.”

Paul Everitt, chief executive of the SMMT, said: “The report demonstrates the fragility of the UK supply chain and underlines the need for concerted action to support its future development.”

In particular, industry and government needed to work together to move towards a low-carbon economy.

Looking ahead for the next 12 months, 40 per cent the companies taking part in the study said they were likely to cut more jobs.

Only 12 per cent felt optimistic enough to forecast no redundancies in 2010.