Stamford's Cummins Generator Technologies is to axe up to 95 jobs in response to 'a continued decline' in demand from its global customers.
The news was broken to staff at the Barnack Road business on Monday.
A spokesperson for the company said: "To respond to the continued decline in demand, Cummins Generator Technologies is taking a number of actions globally.
"On Monday we announced the reduction of up to 95 employees based in Stamford and started a 30 day consultation period with the Union and employees.
"These actions are difficult and will impact a number of people who have worked for Cummins for many years, but are necessary to respond to the current deteriorating global economic conditions and ensure the long-term success of Cummins and all its stakeholders."
The firm wants to finalise the redundancies by the end of December.
The announcement comes just a fortnight after Cummins Generator Technologies was successful in securing a £2m grant from the Government's Regional Growth Fund - intended to create or safeguard jobs.