Major Ashburton bus manufacturer Designline plans to keep all it staff when it shifts up the road to a Rolleston industrial park so it can expand to meet domestic and international demand.
The move, inadvertently revealed by Prime Minister Helen Clark during a visit to the factory last Friday, has disappointed Ashburton Mayor Bede O'Malley.
Designline said it would move to Izone, one of the country's largest industrial parks at Rolleston, 22km southwest of Christchurch, next year in a deal worth $8.5 million.
The company said it was attracted by development options, price and access to a larger labour market, The Press newspaper reported.
"We need bigger facilities and a closer proximity to Lyttelton port, our suppliers and a larger workforce," Designline managing director Jack Schroeder said.
"These weren't immediately available in our current location so, reluctantly, we are moving up the road to Rolleston."
He said Izone had offered a 7500sq m site and flexible development options.
Designline, which employs 150 staff in Ashburton, would keep all staff who wanted to stay with the company and may provide transport to and from Ashburton.
Chief financial officer Greg Morris said labour force details were still being developed, but an extra 100 jobs might be created.
But Mr O'Malley said the shift north had breached a "no-surprises" policy agreed between Canterbury mayors notwithstanding commercial sensitivity.
Designline refused to say anything about the shift until yesterday after formally notifying Mr O'Malley.
But Miss Clark had earlier mentioned the relocation to staff when she was speaking off the cuff over afternoon tea on Friday.
Mr O'Malley said he was disappointed at the level of communication and how news of the shift became public.
He said his door was always open, but Designline hadn't approached him with its concerns about space at its current site.