AYRSHIRE'S economy has been dealt a major jobs blow as satellite manufacturing company Mangata Networks scrapped their plan to bring almost 600 jobs to Prestwick.

They blamed "challenging economic conditions" for the decision to scrap the move, which formed a major part of the Ayrshire Growth Deal.

The satellite-enabled cloud services company had announced Prestwick as the location for its research and development activities, as well as satellite manufacturing, space systems and core network operations.

The hub was set to be supported by a funding and assistance package of more than £83.7 million from Scottish Enterprise, the Scottish Government, the UK Government and South Ayrshire Council.

The company insisted in January that its plans were "progressing", despite mounting speculation over the future of the project.

A spokesperson for Mangata Networks said, “Due to challenging global economic conditions, significant increases in material costs and issues with supply chain availability, Mangata Networks, in consultation with Scottish Enterprise, has made the decision to end the new build project for its facility in Scotland.

"Our focus will now shift towards identifying and adapting existing structures within the region to meet Mangata's manufacturing needs.

"Despite this change, Mangata remains committed to maintaining its product Research and Development operations in Scotland. We are also actively considering Scotland as a potential base for our satellite and network operations.”

A spokesperson for Scottish Enterprise said: “It is disappointing that Mangata Networks has decided to withdraw from its planned manufacturing and operations project in Scotland.

“It’s testament to Scotland’s status as the most attractive location for inward investment in the UK outside of London, and our thriving space sector with a skilled workforce and growing expertise, that we initially attracted Mangata to Scotland against stiff global competition.

"The Prestwick International Aerospace Park site remains an attractive and strategically placed location.

"We will continue to seek out ambitious companies looking to scale by promoting Scotland’s excellent capabilities in Space and growing reputation for innovation.”

A South Ayrshire Council spokesperson said: “It’s disappointing for the Ayrshire Growth Deal that Mangata has withdrawn from its plans to build a new manufacturing facility in Prestwick.

"South Ayrshire Council is fully committed to the Space and Aerospace programme within the wider Ayrshire Growth Deal, and significant work is being carried out to define the scope and requirements of the projects to meet current and future needs of the aerospace sector.”

A Scottish Government spokesperson said: “We are aware that Mangata Networks has withdrawn from its planned project in Ayrshire due to a number of global economic and inflationary pressures.

“This decision should not detract from Scotland’s ongoing success in attracting inward investment as part of a clear and strategic approach to capitalising on our key strengths and potential.

"We welcome the company’s ongoing commitment to existing operations in the country – and commitment to exploring new opportunities.

“We will continue to work alongside our economic agencies and other partners in a 'Team Scotland' approach to attracting inward investment and developing the many economic opportunities to be unlocked – both in the Ayrshire region and across the country.

"We will also work with Ayrshire Growth Deal partners to ensure that Deal money allocated to the project continues to be used to enable the region’s aerospace sector to develop and grow.”

A UK Government spokesperson said: "While Mangata Networks' decision is disappointing, we're continuing to work with all partners to maximise the benefits of the 10 year Ayrshire Growth Deal which will see more than £250 million invested in Ayrshire's economy."