Managing director of Nissan UK, John Cushnaghan yesterday told a Treasury Select Committee that up to 2000 car worker’s jobs, and a further 10,000 suppliers jobs, depended on the company deciding to build the new model Micra at its plant in Sunderland. He went on to advise MPs that a major factor in deciding where the new Micra would be built was the relative strength of sterling against the Euro.

Cushnaghan explains that it was becoming increasingly difficult to argue the case for Britain because of exchange rate uncertainty. He said the manufacturing industry had a "a great potential for decline" if Britain stayed out of the Euro. Cushnaghan said that the exchange rate would be one of the issues considered by the Nissan board in Tokyo when deciding where to build the new Micra.

One of the options available to Nissan is to work in conjunction with its partner Renault in producing the new model Micra at sites in either France or Spain.

The Daily Telegraph reports Cushnaghan as having said that even without the handicap of the exchange rate, Sunderland would have to cut costs by 25 per cent to make it a competitive site for the Micra. He added that it was wise and sensible to eliminate the exchange rate risk by joining the single currency.