Employees at the Newport plant have been told at least half of its manufacturing operation will be cut amid changing demand for turbine blades.

Vestas is switching from making offshore blades to smaller, onshore blades, which will only sustain 300 jobs at the site, it said.

The change will lead it to repurposing the site in Newport.

The factory opened in 2002 and makes an older type of offshore wind turbine blade which is much smaller than new models.

Vestas said it has agreed with the Government that it can make blades for onshore wind farms instead, helping to keep 300 jobs.

Executive Anders Nielsen said: “We are pleased that this partnership in principle with the UK Government means we can continue manufacturing activities at the Isle of Wight to support the deployment of onshore wind in the UK.

“My sincere gratitude goes to everyone working for us on the Isle of Wight, for their significant contribution to wind energy, and we are pleased to be retaining and offering a significant number of opportunities for our impacted colleagues during this process.”

Vestas said its technology activities, which employ approximately 140 people on the island, will not be affected.

A consultation process has started on the job cuts, and employees will be told the result by January.

Energy Secretary Ed Miliband said: “My thoughts today are with the staff at Vestas who are facing uncertainty about the future of their jobs, especially at this time of year.

“I am, however, pleased that we have reached this agreement in principle with the company to save 300 jobs on the site, and that our lifting of the ban on onshore wind farms is helping make a site earmarked for closure viable for the future.”