Motor Coach Industries (MCI) – which began its corporate life in Winnipeg 70 years ago – announced Friday it will close all three of its plants in the city, throwing 1,300 people out of work.

MCI said the closures will happen in the fall of 2003. The company, which makes buses, said the decision to shut its Winnipeg operations came after at least three years of heavy losses and declining demand for its products.

"Our greatest problem right now is we have three facilities and we have capacity to build about 20 coaches a day," MCI senior vice-president Sam St. Amour said. "Unfortunately, the world, or our world in North America, only requires six or seven coaches."

St, Amour said the Winnipeg work would be moved somewhere to the American south. The company has previously mused about consolidating operations in a state where labour laws are weaker and wage costs are lower.

The company had been trying to persuade its Winnipeg workers to agree to a 40-month wage freeze and agree to other concessions. But that proposal was turned down last weekend. MCI also has manufacturing facilities in Pembina North Dakota.

MCI began as an auto repair shop in Winnipeg back in 1932 and gradually diversified and expanded in succeeding decades. It is now American-owned.