THE loss of a fifth of its orders to overseas competition has led to 23 redundancies at an electronics company in the region.

Mechetronics, in Bishop Auckland, County Durham, which employs 77 people making mechanical equipment for vending and cash machines, said it had been forced to make the cuts to safeguard the future of the business.

Bosses learned this week that key customer NCR, which accounts for 20 per cent of Mechetronics' orders, was taking its business overseas.

The company's major client EJA, which makes up one-fifth of its orders, is also moving work to the Dominican Republic.

Although production will continue at Bishop Auckland for UK customers, Mechetronics said it had seen a slowdown in orders from all customers.

Managing director Dianne Sharp announced the job losses to workers at lunchtime yesterday, saying it was with great regret that the company had been compelled to protect the future security of its business.

She said: "We received the disappointing news this week that we have lost one of our major customers, NCR, who have awarded their business to an Indian supplier, despite our very competitive prices."

Another customer, Haldex, is developing a manufacturing plant in China, which is also having an impact on Mechetronics.

Ms Sharp said: "We are consulting our staff and union regarding the redundancies and seeking volunteers.

"We deeply regret having to make these redundancies, particularly in such a loyal and close-knit workforce, but we have no choice if we are to safeguard the future of the company and the people who will continue to work here."

Mechetronics makes solenoids - electronic mechanical devices used in vending machines, anti-lock braking and computer printers.

The managing director of Newton Aycliffe furniture companies Europa Sofabeds and Brundellwood Upholstery, which employ about 210 people, said a seasonal downturn had led to seven redundancies at Brundellwood.

John Forrester said: "It's the time of year when it quietens down for us and we need a little bit more confidence in the market. When there is a consumer slowdown, people tend to be cautious about buying larger items."