Remaining employees were this week told by management that the business will close after a 30-day consultation process.
The SDLP South Down Assembly candidate Cllr Karen McKevitt has said the Kilkeel community is devastated at the loss of the 46 jobs due to the closure of the local firm.
Speaking yesterday, she said: "This is a sad day for Toughglass employees, particularly those who depended on their jobs at this company as their main source of income to feed and raise their families."
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The closure will be implemented in phases over the coming months with the closure of Toughglass, that makes toughened glass for use in buses and coaches - closing down.
This comes after earlier moves - in July 2008 - when it laid off around 60 people, then representing more than half its workforce.
It has emerged that one of its biggest customers was the successful company, Wrightbus in Ballymena - but that it also makes glass for shower enclosures for customers in the beleaguered construction industry.
General Manager John Agnew told BBC NI that the layoffs were due to a combination of factors, including rising costs, a downturn in demand in the retail sector, and low-cost competition from manufacturers in China and Turkey.
Commenting on the human cost, Cllr McKevitt concluded: "It has left many people with an awful sense of despair and hopelessness.
"It is now vital that government invests in the growth areas within our local economy, especially tourism and the green sector in order to create employment for the increasing number of people out of work in South Down."
(BMcC/GK)
