CAR giant Nissan is cutting 1,200 jobs in the wake of the economic slowdown which has hit the motor industry hard and led to sales slumping.
The jobs will go at the firm's plant in Sunderland, which employs around 5,000 workers and is one of the most long-established and biggest employers in the North East.
Shifts will be cut and 1,200 jobs axed, including 400 staff on temporary contra
cts.
It comes just a year after Nissan announced it was creating 800 jobs in Sunderland in response to demand for its Qashqai model.
A third production shift was added at the plant, which first started building cars in 1986.
Today's announcement follows increasing pleas from the motor industry for Government action to boost the availability of credit for consumers as well as firms.
Figures yesterday showed car sales continuing to fall, down to the lowest levels in more than a decade.
Nissan sold 66,336 new cars in the UK in 2008 - only 0.14 per cent fewer than in 2007. This was a much better performance than the national average which saw new car sales slump 11.3 per cent in 2008.
However, Nissan sales for December 2008 fell 26.68 per cent compared with the same month in 2007. This compared with a national decline of 21.2 per cent.
The Sunderland plant is the biggest car factory in the UK and the most productive in Europe.
Trevor Mann, Nissan's senior vice president for manufacturing, Europe, said: "Like all manufacturers, Sunderland plant is currently operating in extraordinary circumstances not of our making. It is essential we take the right action now to ensure we are in a strong and viable position once business conditions return to normal.
"The long-term future of the plant must remain our over-riding priority. However, as always, Nissan will continue to make every effort to minimise the impact on its employees and their families."
Nissan workers only returned to the production line on Monday after an extended Christmas shutdown in response to the slowdown in sales.
Derek Simpson, joint general secretary of the Unite union, said: "This is devastating news for the workers and their families. Today's announcement shows just how serious Britain's economic difficulties are.
"Unite will be doing everything possible to minimise compulsory redundancies and it is absolutely crucial that these workers' skills are not lost."
Business Secretary Lord Mandelson said the Government will work with regional development agency One NorthEast to help workers find new jobs as quickly as possible.
He added: "We will also be working with Nissan to secure new investment for Sunderland and to make sure that the UK is best placed for the upturn and re-creation of jobs as the economy improves.
"We also need to look to the future and our commitment to the development of low-carbon vehicles as an integral part of the UK automotive industry.
"As part of that aim I want to visit the plant as soon as possible to start work with Nissan on plans to bring manufacture of Nissan's new family of electric vehicles to Sunderland."
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