Nissan to build new electric car in Sunderland

Motor giant Nissan is to build its new electric car in Sunderland, it was announced today.

Production of the Nissan Leaf will begin 2013 and forms part of a £420 million investment in electric cars by the Japanese firm.

The manufacturer said the Leaf would be the world's first affordable mass-produced zero emission car and around 50,000 a year will roll off the Sunderland production line.

The investment will be supported by a £20.7 million Government grant and a proposed finance package from the European Investment Bank of up to 220 million euros (£197.3 million).

The announcement was welcomed by Business Secretary Lord Mandelson.

"This investment is a fantastic vote of confidence in the Sunderland plant and its excellent workforce," he said.

"The automotive sector is of key importance to the UK. It supports R&D, technological innovation, skills and a supply chain that's a mainstay of the wider manufacturing sector.

"Today's news from Nissan, with support from Government, shows that by working together we can achieve our aim of making the UK a world-leader in ultra-low carbon vehicles."

Andy Palmer, senior vice president at Nissan, added: "The world is at the dawn of a new era in automotive transport.

"Nissan LEAF, which will go on sale later this year, is a five-seater hatchback that offers the same space, practicality and performance of a similar car in its class - minus the tailpipe emissions.

"Thanks to the UK's firm commitment to a low carbon future in terms of infrastructure, customer incentives and educational programmes, Nissan Leaf will be built at Sunderland, making the UK the third country in the world to produce this revolutionary car."

Sunderland has been widely seen as the favourite for European production of the Leaf since the announcement last summer that Nissan's electric car battery would be sited next to the present factory.

Nissan has already announced production of the all-electric Leaf hatchback in Japan and the United States, with the car due to go on sale at the end of this year.

The company has not specified how much the car will cost, saying only that it will be competitive with similar-sized cars with conventional engines.

Founded in 1984, Nissan's Sunderland factory employs around 4,000 people and built its five millionth vehicle in June 2008.

Margaret Fay, chairman of regional development agency One North East, said: "We are absolutely thrilled at this latest investment by Nissan at its Sunderland factory.

"Today's announcement comes almost a year to the day since Nissan and One North East signed a memorandum of understanding to explore the development of zero-emission mobility.

"Twelve months on, we have reached a position where this partnership has elevated the north east of England and the UK to the world-leading position we now enjoy in the low carbon vehicle industry.

"The support that we have reached from the Government in that time has been critical to our joint success.

"The Nissan Leaf will arrive in the region as we are installing 1,300 charging points to give motorists the confidence they need to make the switch to electric vehicles."

Nick Brown, the Government's chief whip and minister for the North East, said: "Winning the battery factory for Sunderland was a great achievement. We have now built on this by today's truly exciting announcement.

"It means hundreds of new jobs, underpins the existing jobs at both the battery factory and car plant and gives us a brand new product which I'm sure will be a world leader.

"This is tremendous news for Sunderland, east Durham and the north east of England."