TROUBLED French ferry firm SeaFrance is to shed around 650 jobs and reduce the size of its fleet, we can exclusively reveal.

The official announcement of drastic cuts at the company is set to be made this afternoon after a new recovery plan was agreed by bosses of its parent company, the state-owned railway operator SNCF.

These severe reductions in staff and shipping are required to deal with a worsening cash crisis at the Dover-Calais operator. Losses have been mounting as a result of the worsening recession and internal troubles, such as a costly strike last year.

A spokesman for the firm said: "The restructuring plan would involve a significant reorganisation of the company with the ambition of achieving a revitalised business in the coming years.

"It has been developed taking account of both the current situation of SeaFrance and the medium term forecast of cross-Channel traffic.

"Several measures are envisaged in the plan, notably the downsizing of the SeaFrance fleet to align it with the market and to reduce costs. As a consequence of the restructuring, a reduction in staff numbers of 650 is foreseen, affecting both sea-going and shore-based staff."