THE UK's largest independent producer of retread truck tyres is considering moving away from its headquarters in Lee Mill – with a potential loss of more than 300 jobs to the area.

Family run business Bandvulc Tyres feels the Government is pushing them out of business with a promised fuel tax hike.

Now the owners are considering relocating to a factory in Eastern Europe.

A total of 65 per cent of the UK's groceries are delivered on Bandvulc tyres and the three main German cities of Berlin, Hamburg and Munich exclusively use Bandvulc tyres on their municipal vehicles.

With this growing economy in Europe Bandvulc could consider setting up a factory on the continent to be closer to a more profitable market.

Bandvulc employs a total of 335 people, the majority at their headquarters in Lee Mill.

Richard O'Connell, who founded Bandvulc with his brother John in 1971, said: 'The company transports approximately 5,000 tyres to and from Lee Mill each week.

'This uses 100,000 gallons of diesel per year. Every 1p rise per litre in diesel, increases our overheads by £8,000.

'There comes a point where it is cheaper to move the export work closer to the market than it is to transport the goods.'

Conservative MP for Totnes Dr Sarah Wollaston said in a Commons debate last week: 'My constituents spend a far greater proportion of their disposable income on fuel than those who live in cities.

'A further 3p rise in January would not just hit householders, however; it would hit essential local businesses, too.

'Some 65 per cent of all the UK's groceries are delivered on retread tyres produced by a company in my constituency: Bandvulc tyres.

'It is a family-run manufacturing business producing a sustainable product and creating local jobs.

'It wants to stay in Devon but knows that it would make economic sense to relocate part of its business to eastern Europe'.