Struggling pressings producer Cardale Engineering has been placed into administrative receivership, handing the UK engineering sector a fresh crisis.

Mike Kent, general manager, blames its financial crisis on unrealistic prices offered by car manufacturers, overseas competition, and the state of the UK economy.

The future of 85 jobs at the firm's Luton site – which produces OE exhaust systems pressings for several major carmakers and for tier-one suppliers – are now left hanging in the balance as the company is left looking for a buyer.

“Despite very significant investment and support from our parent company over recent years, it has not been possible to retain the company as a viable operation. This is a very sad day for all concerned,” says Kent.

Ian Gould, of business adviser PKF, says that 30 parties have already shown an interest in the firm and eight potential buyers have visited the site. But unless a buyer is found for the operation in the next 14 days, most of the jobs will go and the company will be wound up. Gould says that receivers are currently carrying out a full assessment of the firm's debt but indicated the losses were “horrendous and very significant”.

“The administrative receivers will be looking to work with customers, suppliers and the company's workforce and I am hopeful that it will be possible to sell the business as a going concern,” Gould says. Cardale Engineering has net assets of £1.8m and is part of the Cardale group of companies, which also produces garage doors.