Homes evacuated as fire crews battle Sutton Tools factory blaze in Kaiapoi in Canterbury

Five fire crews are still at the scene of a factory fire in Kaiapoi. Photo / NZME

Up to 40 houses were evacuated overnight due to a major factory fire in Canterbury.

The Sutton Tools factory on Dale Street in Kaiapoi has been gutted in the blaze.

Emergency services were called to the fire just after 12.30am. Nobody had been injured, police said in a statement.

"As a precaution, police assisted by evacuating some nearby residential streets, with residents from around 30-40 houses taken to Kaiapoi North School.

"Fire and Emergency crews are still working to fully extinguish the fire and will be undertaking mopping up duties this morning."

Fire investigators were expected to attend the scene later this morning.

Sutton Tools was the only drill bit manufactuer in New Zealand. It employed multiple generations of local families and many employees had been there for decades, a worker told the Herald.

She said she was "in shock" and the fire would rock the Kaiapoi community.

The fire was thought to have started just after the night shift, she said. Popping noises that were heard during the fire were oil drums exploding.

Shanks that had just arrived after being on order for months due to supply chain issues had melted like candles.

"The company has employed generations of locals, most of who have worked here for 30 plus years," she said.

"Most people who start there, marry there, have kids there and their kids work there. It's a family not just a business."

Fire fighters at the scene had told her it was one of the worst fires they had seen, with flames shooting up to 20 metres in the air.

At 4am there were 14 fire appliances at the scene. Residents were being warned to stay away as the fire was still burning.

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Southern Fire and Emergency shift manager Jill Higgison said as of 6.30am there were still five fire crews in attendance.