ENGINE-maker Cummins has played down fears of imminent job losses after announcing its latest restructuring plans.

The US-owned business, which employs 735 people at its plant in Darlington, is to transfer out its storage and logistics section to another company.

The move, subject to a three-month consultation process, is expected to affect scores of workers, although no numbers have been confirmed.

Some material-handling workers will be offered jobs with the as yet unnamed company, while others are expected to move into engine building.

The Darlington plant needs to make about $10m (£7.1m) of savings after being hit by a shrinking export market and tough economic conditions.

More than 120 jobs have already been lost in recent months through a combination of compulsory and voluntary redundancies in an effort to reduce overheads.

A Cummins spokesman said the change would not result in a fresh round of job losses and was part of a re-focusing of its operations.

He said that orders for Cummins' diesel engines were at high levels despite current economic conditions.

The outlook for the plant, which has been the subject of a multi-million pound investment programme in new technology, was secure.

Despite the reassurances, Gerry Hunter, regional officer with engineering union Amicus, said his fear was that Cummins would not be able to accommodate all the staff who wanted to stay at the Darlington plant.

The union would be doing everything it could to prevent any possible job losses.

Mr Hunter said: "We have always understood that Darlington has an exceptionally low wages-to-product cost ratio and would hope this would be a factor in any decision.

"We need to get some rationale from the company as to why they want to make this move and make sure our members wishes and aspirations are taken into account during discussions."

Cummins has had some international success with its small diesel engines, which are fitted to Leyland DAF trucks.

About 60 per cent of its high performance commercial diesel engines are exported abroad, largely to the US.