GKN has set aside £120m ($171m) to pay for the costs this year of short-time working, plant shut-downs and redundancies, as the engineering group announced the loss of 1,400 more jobs in the past two months.

Sir Kevin Smith, chief executive of the aerospace and auto parts maker, said poor trading across the global car market made it likely further job cuts would be required. GKN said its automotive unit made a loss in November and December.