Rising energy and raw material costs have triggered a voluntary redundancy programme at a Warwickshire maker of plastics components.
Around ten jobs could be forced to go at Plastic Engineering (Leamington) which is facing the prospect of its electricity bill doubling this year.
The firm, which makes plastic parts for seatbelts, airbags and other automotive assemblies, has been hit by increasing plastics costs which have risen by a fifth.
Plastic Engineering which employs 150 people, has now called for volunteers to consider redundancy as it struggles to maintain margins.
Chief executive Steven Mills said: "We have just instituted a programme of asking for voluntary redundancies.
"I cannot say how many people it is going to be - you never know who is going to going to volunteer, but we have to save around #250,000, so it could be around ten people."
Mr Mills said that although his firm's energy contract runs until October, it had to begin planning for the next one to avoid even higher bills.
He said: "Electricity and raw materials are among our biggest costs. We have 80 thermoplastic moulding machines, so it can be quite expensive.
"Small companies like us are also facing increased costs for plastics as well."
Mr Mills said he expected the current energy bill to increase from #250,000 to #500,000, while the bill for plastic has risen by #500,000 in the last year.
Current costs have gone from #3.5 million to #4 million.
The company has been looking at other ways to reduce costs before launching a consultation period on job losses.
Mr Mills said: "We have been looking at all sorts of things including alternative specifications for our products.
"But this is very difficult because most of the products we make are very safety sensitive.
"We used to work seven days a week, but now we close down on Friday evenings. We are also looking at future pay awards which are not going to be anything other than zero.
"Margins are being squeezed and squeezed. We have to look at labour costs and raw materials which are two biggest costs."
Mr Mills said it was impossible to pass on the increased costs to his customers, who were demanding lower costs amid increased competition from the Far East and eastern Europe.
Mr Mills said: "We intend being around for the long term, and we believe there is an excellent future for the business by making mouldings at the cutting edge of technical excellence, doing the more complex work which other countries cannot do."