Management at Kel-Tech engineering in Waterford has confirmed that the company will be making 55 compulsory redundancies.
In a statement, the company said its largest customer announced a number of weeks ago it would be scaling back.
Kel-Tech said the loss of the contract will see the turnover of the company being significantly reduced.
Management said the redundancies would be on a "last-in-first-out" basis.
The firm currently employs 120 people.
