YORK rail manufacturer Thrall Europa is set to close in December with the loss of 260 jobs.

The grim announcement was made to workers at the wagonworks in Holgate Road today, just five years after it opened on the site of the former carriageworks.

Parent company Trinity Rail GmbH told the Evening Press the closure was proposed because there were no foreseeable further orders when the company completes a major five-year contract to build 2,500 wagons for EWS.

The announcement comes only weeks after the works won a reprieve with an order for an extra 220 coal wagons from EWS, which it was hoped would keep the factory in operation until next February.

The wife of a Thrall employee told the paper today she was "very upset" by the news.

She said she had a family to look after and her part-time job was not enough to buy the weekly shopping.

She was concerned that the jobs market would be flooded by skilled men at a time when there were few manufacturing jobs around in York.

Trinity Rail GmbH President Chris Schmalbruch said: "We very much regret having to make this proposal, which would result in the loss of 260 jobs and closure of the plant in December.

"But we have had to make the closure proposal due to the fact that upon final delivery of the five-year contract there are no foreseeable further orders from any customers in the UK rail industry.

"At present, there is no demand for wagons from anyone in the UK at levels to sustain this plant, which can only build for the UK market, due to restrictions on physical size of wagons for shipment from Britain.

"The company is doing everything possible to assist its York workforce and consultation with employee representatives currently is being progressed by the company's human resources director."

The company said Trinity would continue with a UK presence by maintaining a sales and marketing presence as well as a service parts business.

It would also carry out a full after-sales service for wagons currently and previously built by the company and supplied from Britain. These activities would be "likely to be based in Yorkshire", but it did not say where.

Tony Bennett, City of York Council's assistant director for economic development, said: "I am very disappointed, given all the support and hard work that has been given over the past five years.

He said he would be seeking "very urgent" talks with Thrall and also the owners of the site, partly seeking clarification as to whether the after-sales service could be based in York. The authority would be doing everything possible to ensure manufacturing continued on the site, if possible rail manufacturing.

He said the location had strong and unusual selling point with its direct rail access for freight wagons.

Updated: 12:10 Friday, June 28, 2002