HUNDREDS of jobs will be axed when a leading chemicals company shuts its Hampshire plant.

Polimeri Europa UK Ltd announced today it is closing its factory in Cadland Road, Hythe, where 300 people work.

The company, which is a subsidiary of Versalis (Eni) manufactures synthetic rubbers mainly used to make tyres and moulded foams.

Members of staff were called together for a meeting at 2pm yesterday afternoon to be told the news by company bosses from Italy.

A statement released by the company today said: “Polimeri Europa UK Ltd, a subsidiary of Versalis (Eni) in the UK, announced to its employees a proposal to cease operations at its Hythe site during the first quarter of 2014.

“We will start the consultation process with the trade union and employee representatives within the next two weeks.

The company,which has operated there for more than 50 years, puts its decision down to a declining demand from the European motoring sector and a reduction in the replacement tyre market due to motorists driving fewer miles.

Daily Echo:

This is made worse by less export opportunities due to increased capacity in Asia and increased capacity in Asia reducing export opportunities and stringent European regulations leading to a move from commodity emulsion products to solution products.

The statement continued: “Following a review of the future of the global market for these products and the economic effect on the production operation at Hythe, the company announced its proposal to cease operations.

“The Hythe site has been successful in making significant improvements to its performance over the last few years however, unfortunately, without a sustainable market for its products it is unable to benefit from the progress made.”

Around 300 people work at the plant in Hythe, but the firm says 120 members of staff face losing their jobs, with many more contractors also facing losing their jobs.

But the company stressed the solution-based polymer production and the expansion of Eni's elastomer production capacity at Grangemouth oil refinery in Scotland will be unaffected by this announcement.