One of Britain’s biggest brick makers is to close two of its largest factories, blaming the slowdown in the housing market for sluggish demand.

The chief executive of Wienerberger, the world’s largest brick maker, said that he would be moth-balling plants in Surrey and Devon in the face of a very weak British housing market, which had worsened sharply over the past eight weeks.

Wolfgang Reithofer indicated that he would be prepared to close temporarily one or two more of his fourteen British brick and tile manufacturing plants over the coming months if there was a further marked deterioration in the housing market.

Staff were informed of the closures of the Wienerberger plants at Steer Point in Devon and Ewhurst in Surrey this month, Mr Reithofer said. About 80 jobs would go. It is unclear when the factories will reopen.

The redundancies at Wienerberger highlight growing concerns about the scale of job losses in the wider construction industry as Britain grapples with a sharper slowdown in housing production than that suffered even in the recession of the early 1990s.

At full capacity, the closing Wienerberger factories account for about 20 per cent of the company’s total British production, according to industry sources. Between them they can supply a market stretching broadly from the South West to Kent and Greater London, potentially the most lucrative housing market in the UK.

Mr Reithofer said: “To start with, the sales market in the UK is very, very weak and has deteriorated over the last weeks – let’s say the last two months . . .

“It seems there is underlying demand, but the problem is financing, not only first-time buyers but more importantly the second-time buyer. There are four times as many second-time buyers as first-time buyers. It is a question of finance and this has impact. It will impact the strategy of housebuilders. They will not start new projects or will delay some other project.” He added that demand would grow, but in the meantime housebuilders would be cautious.

The chief executives of most of Britain’s big housebuilders have said in the past few weeks that they have been forced to slow production on existing sales sites and put the brakes on opening up new sales sites as sales slowed sharply.

The Government will hope to kick-start the housing sector this month after Sir James Crosby, the former chief executive of HBOS, presents his report on funding shortages in the mortgage market to Alistair Darling. Sir James has looked at improving liquidity in that market after lending between banks dried up in the credit crunch.

Many analysts are predicting that house prices could fall by 10 to 20 per cent, but prices in the futures market for property have collapsed even more. Traders are betting that house prices will fall 50 per cent in four years and they do not expect prices to recover until 2017.

Last week Bellway, Britain’s fourth-largest housebuilder, gave warning of no recovery in the UK housing market before the second half of 2009, the gloomiest outlook yet from the industry as it revealed a 31 per cent fall in its house sales since the start of February.

Quiet on home front

— New house builds declined by 24.4 per cent to 32,144 in this year’s first quarter, against a year earlier, and fell 21.5 per cent, compared with 2007’s final three months, according to Department for Communities and Local Government data

— Taylor Wimpey, Britain’s biggest housebuilder, is in talks with staff to close 13 of its 39 UK offices, which could cost up to 600 jobs, about 30 per cent of its workforce.

— Housing executives say that building starts on new homes this year could fall to between 100,000 and 110,000, down from about 164,000 last year

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