100 jobs face axe with Midland factory closure

Industrial group IMI says a 'material drop in demand levels' for the products made at the site in Witton led to the decision.

Work at IMI Components, in Noble Way, is expected to start winding down after the end of this year with closure sometime in the middle of 2015.

Around 109 people work at the factory, which supplies components to the nuclear fuel enrichment market.

The news was broken in IMI's half year statement to the City yesterday, when it revealed that its nuclear operations had seen a 37 per cent slump in orders over the six months, with "a material drop in demand levels at IMI Components".

The drop in orders cost the company £1 million and IMI said it expected the closure of the Birmingham factory to cost up to £10 million.

Company spokeswoman Suzanne Bartch said later that the closure decision came after the factory's single biggest customer – which is not being named – had announced it was 'effectively mothballing' its own nuclear business.

"It's a regrettable situation but the global nuclear market has seen demand in decline since Fukushima," she said.

Confidence in the nuclear industry suffered a massive blow as a result of the Fukushima nuclear disaster in Japan in 2011. The enormous tsunami that hit the country wrecked the plant and caused three of Fukishima's six reactors to melt down.

"Since then a number of countries have decided to shut down their own nuclear reactors and global demand has been in decline. Now this site's biggest customer has signalled that it is putting its own business into hibernation and will no longer be taking parts from the facility after the end of this year."

IMI management are now in consultation with staff and unions, but the company is expected to start winding down the factory in the first half of next year.

Overall, Birmingham-based IMI, which employs 12,000 people at sites in 20 countries around the world, saw revenue for the first six months fall by three per cent to £809 million while pre-tax profits were down five per cent to £127 million.

Chairman Roberto Quarta said: "We have undertaken a very detailed review of all aspects of the group and, building on IMI's significant strengths, we have a robust plan in place to drive growth and build long term shareholder value."

In the UK, 16 reactors generate about 18 per cent of our electricity but all but one of these are due to be retired by 2023. The British Government plans to build new nuclear power plants, but elsewhere the picture is gloomy.

The worldwide decline in the nuclear industry was highlighted by a new report in recent days that shows its share of global power generation has fallen to its lowest level since the 1980s. After reaching a peak share of 17.6 per cent in 1996 it has now fallen to just 10.8 per cent.

The World Nuclear Industry Status Report found that of 67 reactors under construction around the world at least 49 are experiencing delays and eight had been under construction for 20 years.

Tatsujiro Suzuki, former vice chairman of Japan's Atomic Energy Commission warned in the report that more than 200 reactors face shutdown over the next 20 years.

"If new construction pace does not match the pace of shutdown, it is clear that the nuclear share will decline rapidly," said Mr Suzuki.