The change in policy follows the conclusion of Toyota Manufacturing UK's annual salary review process, a series of meetings at which firm and worker representatives exchange concerns and views.

The announcement of a return to full-time working comes just before the planned temporary shutdown of Burnaston (which runs over 29 March - 9 April).

Toyota is giving all workers an additional five days paid holiday to be used during the non-production period, along with one extra floating day, "in recognition of their flexibility and commitment".

Burnaston builds the Auris and Avensis models, both of which have been recalled due to problems with sticking accelerator pedals. Even before this recall fiasco, Toyota was anyway looking at scaling back its Burnaston operation, and to go down to one production line (now though to be scheduled for August).

Deputy managing director Tony Walker said: "We have to re-organise now... We had a crisis a year ago, we were able to take temporary measures but now it seems we have to be able to be efficient at lower volumes."

"The next year is key for Toyota Manufacturing UK, employees returning to full-time working and offering a voluntary release programme will allow us to adapt to the reduced market. We believe this decision will be welcomed by our employees, who have shown flexibility and commitment to the company during this difficult time."

Whilst the job cuts and shift to one production line is clearly bad news, and indicative of the fragile state of the industry, to be fair to Toyota there are no compulsory redundancies.

The firm has tried hard through the downturn to retain skilled staff, and to keep production moving at its efficient Burnaston plant. The firm's UK operations have been caught between a general market downturn and a drop in sales resulting from its recall woes.

The latter goes back to Toyota's rapid over-expansion and failure to maintain quality in design, testing and procurement. None of that reflects badly on Burnaston and Deeside which remain world-class operations. Rather it reflects a failure of top management in Toyota to grow the firm as a more sustainable rate.

Of course, a more supportive industrial policy towards manufacturing in general by the government might have better helped Toyota through the downturn, including a part-time wage subsidy to help the firm hold on to capacity and jobs.

Professor David Bailey works at Coventry University Business School.