Car giant Ford has warned that leaving the European Union without a deal next month would be "catastrophic" for the UK's auto industry.

Although the company did not confirm a newspaper report suggesting it was stepping up preparations to move production out of the UK, bosses have issued the stark warning ahead of the UK/EU divorce day in March 29.

A Ford spokesman said: "We have long urged the UK Government and Parliament to work together to avoid the country leaving the EU on a no-deal, hard-Brexit basis on March 29.

"Such a situation would be catastrophic for the UK auto industry and Ford's manufacturing operations in the country.

"We will take whatever action is necessary to preserve the competitiveness of our European business."

It had been reported Ford told Prime Minister Theresa May during a telephone call with business leaders that it was preparing alternative sites abroad.

The car industry has been warning about the impact of a no-deal Brexit, with some already cutting back on jobs and production plans.

Ford's Basildon base is likely to be unaffected in the short term as the firm announced a major shake-up of its European operation.

Last month, the motor giant signalled “significant” cuts among its 50,000-strong European workforce under plans to make it more competitive and make its business more sustainable.

Ford has started consultations with unions, with details of job cuts not expected until later in the year.

It is understood the Basildon base is likely to be unaffected in the short term while staff based at Warley, near Brentwood, have been assured of a move to the Dunton base.