Japanese car manufacturer Honda is considering cutting the pay of thousands of its UK workers in response to the downturn which has hit the motor industry and the wider economy.
The car giant has written to workers at its factory in Swindon, which has had production halted, to inform them of the "dire" situation facing the company.
The letter, from Dave Hodgetts, director of planning and business, said: "From an economic viewpoint, we can not find much encouragement for the next 12 months, as the downturn continues to affect car sales throughout Europe."
The news comes after other companies have announced they would be asking staff to agree to a pay freeze or pay cuts in return of no compulsory redundancies.
However, an official at the Unite union said that negotiations with Honda have so far not been held.
Unite's regional officer, Jim D'Avila, said: "Honda is following Toyota's lead. In return for no compulsory redundancies, the company is asking the staff to accept cuts in pay. No decision has been made."
Honda said it has made "enormous efforts" to restrict and cut costs while protecting jobs, but a "small number" of workers had applied for voluntary redundancy.
Copyright © Press Association 2009