Most of vanmaker LDV's 850 employees have been made redundant, administrators for the stricken firm have said.

The devastating news came just hours after the Birmingham-based firm went into administration following the collapse of a rescue bid.

Rob Hunt, joint administrator and partner at PricewaterhouseCoopers said: "Due to the lack of funding it has, regrettably, been necessary to make the majority of the workforce redundant and we will retain a skeleton workforce of around 40 people to maintain the site."

Thousands more workers are employed in firms which distribute LDV vans or supply parts and other services, dealing a fresh blow to the motor manufacturing industry.

Managers issued a final appeal to the Government on Friday to help save the company, warning that around 4,000 jobs were at risk after a rescue deal by Malaysian firm Weststar collapsed.

They argued that a loan of £60 million would help refinance the firm and help turn it into a profitable business.

But a delegation by workers to Westminster to press home the case had to be called off because the Cabinet reshuffle meant no ministers were available to meet them.

The Government was warned that the cost of closure to the Treasury will be up to £53 million in unemployment benefits and lost taxes in the first year, while the economy will lose over £200 million of wages, purchases and export revenue.

The firm, owned by Russian giant GAZ, has not built any vans since mid-December after a slump in demand.

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