Ford is to close its engine plant in Bridgend next year, according to union sources.
The decision will lead to the loss of 1,700 jobs at the South Wales factory, and many more in companies supplying goods and services to the plant.
The news was being confirmed at a meeting between company officials and union leaders, sources said.
The closure, due in September 2020, deals another huge blow to the car industry.
An official announcement from Ford is expected later today.
GMB regional organiser Jeff Beck said: “We’re hugely shocked by today’s announcement, it’s a real hammer blow for the Welsh economy and the community in Bridgend.
“Regardless of today’s announcement, GMB will continue to work with Ford, our sister unions and the Welsh Government to find a solution to the issue and to mitigate the effects of this devastating news.”
Workers were being given the news at briefings inside the plant and are then expected to leave for the day.
The site opened in 1980, covers an area of 60 acres, and is one of Wales’s major employers.
Unions have previously warned of a ballot for strikes if compulsory redundancies are made.
The news is the latest blow to the UK’s car industry.
Honda has announced plans to shut its Swindon plant in 2021, while fellow Japanese car-maker Nissan reversed a decision to build its new X-Trail vehicle at its Sunderland plant.
Jaguar Land Rover, owned by India’s Tata Motors, is also cutting jobs.
Ford also has another engine plant in Dagenham, Essex, and a plant making transmissions in Halewood, Liverpool.
Ford announced last month that it was cutting 7,000 white collar jobs worldwide, with up to 550 expected in the UK.