UP to 85 jobs could be axed at Victoria Carpets' Kidderminster factory, it has been revealed in a shock announcement.

Company bosses dropped the bombshell yesterday, as they declared they would be pulling out of Axminster weaving.

The grim news had been flagged up in warnings issued by the carpet-maker towards the end of last year as it cited "market and operational difficulties" in the Axminster manufacturing operation, which accounted for five per cent of the group's turnover.

In a statement, Victoria chiefs said "substantial management time and effort" had been focused on the operation but that it had been "significantly disproportionate to the size of the business".

Pulling out of Axminster weaving will signal the end of an era at Victoria as the operation has been part of the company's business for 50 years.

The statement said: "While our Axminster department has contributed towards overheads, it has remained unprofitable and, despite our best efforts to improve productivity and to eliminate losses, it has not yet reached breakeven.

"In the year ended March, 2004, the Axminster operation had sales of approximately £2.73 million and contributed a pre-tax loss of £0.74 million. In the first six months of the current financial year, Axminster sales totalled £1.68 million with pre-tax losses of £0.62 million."

It went on: "Although losses from the Axminster business have been reduced over the last four months, the directors believe that the market for this type of traditionally woven carpet will not return to historic levels, mainly as a result of a change in consumer taste, and margins will come under increasing pressure from manufacturers based within much lower cost economies."

The company's decision "may result in the loss of up to 85 jobs at Victoria Carpets Limited in Kidderminster ..." according to the statement.

"It is with regret that through this proposed action, the group is likely to lose many of the loyal, dedicated and long-serving employees associated with Axminster production and sales," it added.

"However, it is crucial, with the increasing demands of the industry and the consumer, that the group remains focused on its core and profitable tufted and specialist Wilton weaving businesses, which represent 95 per cent of the group's overall trading."