Insurance giant L&G is to cease production at its timber-frame modular housing factory seven years after setting it up and after racking up at least £174m of losses.

L&G had promised to build 3,500 homes a year from its plant in Sherburn-in-Elmet, near Selby, West Yorkshire, but today said it had “not been able to secure the necessary scale of pipeline” to make the business a success, and was commencing a redundancy consultation with all employees.