Indesit, which bought Hotpoint just seven years ago, has cited a double whammy of falling demand and rising raw material costs for the decision to close its factory at its UK head office at Morley Way.

But it is the drop in demand that has spelt the end.

The figures put forward by the company make grim reading.

Over the last four years the demand for the free-standing fridges – those made by Indesit and its rivals – has plummeted by 9.7 per cent.

During the 12 months from April 2006, the number of those fridges sold in the UK stood at 2.9 million, but over the year ending March this year, that figure had dropped to 2.7 million – a fall of about 8.6 per cent.

While the closure announcement is a shock – especially to the workers and their families – for many it is not surprise.

In an era that has seen the dramatic decline of the UK's manufacturing base, it has been easy over a prolonged time to point the finger at the factory and say "you're next".

However, the view from the boardroom suggests the decision to axe the manufacturing base was not inevitable.

It was a point made by Indesit's UK manufacturing director, Carlos Ramos, who claimed that over three years some £8 million had been invested in the site and that efficiency measures had been introduced – but to no avail.

It seems to be a matter of taste. A spokesperson for the white goods industry says a growing number of householders prefer built-in fridges or even the large American freezers to the stand-alone models produced in Peterborough.

The squeeze on household spending has not been highlighted by Indesit, although it has certainly been a factor for concern voiced by rivals such as Electrolux, which is also combating a worrying fall in white good sales.

Add to a fall in demand the rising cost of raw materials, and it was almost inevitable that for an international company the size of Indesit, which has 42 centres around the world employing 17,000 people and with a turnover of three billion euros, it was always going to be cheaper and easier to move the manufacturing operations to another centre and so benefit from the resulting economies of scale.

Indesit will still have 1,000 employees working in administration, call centre, servicing, logistics, recycling and parts at Morley Way.

But for Peterborough the job losses will be a headache for its movers and shakers who have ambitious £1 billion plans to grow the city.

Over the last 12 months a number of high profile companies have made major job cuts, including 400 at Barclays Wealth, 243 at Lloyds TSB and 250 at DVD and CD distributor ChoicesUK.