Scrappage scheme eases Nissan's pain

May 2 2009 by Andrew Mernin and Peter McCusker, The Journal

WEEKEND working is to begin next Saturday for 1,500 workers at car giant Nissan as the first signs begin to emerge that the squeeze on car-makers is starting to ease.

The firm, which has axed 1,200 jobs in the last six months as worldwide car sales plunged by over 50%, says it had seen a increase in demand due to scrappage schemes in Europe, which have seen new car sales rise almost 40% in Germany in recent weeks.

And now, as a similar scheme in the UK is being introduced, the company is gearing up for further growth in demand and has scheduled overtime shifts on its two production lines.

The news has been welcomed across the region and will come as a major boost to the company’s embattled workforce.

Deputy managing director Kevin Fitzpatrick said: “As a result of existing scrappage schemes operating on the continent, as well as the recently announced UK scheme expected to begin next month, Nissan Sunderland plant is expecting an additional, short-term demand for volume. In anticipation of this temporary increase in customer demand, we have scheduled overtime on both of our production lines (although at a reduced speed), including some weekend working in line with our volume flexibility agreement.

“Due to the effects of the ongoing financial crisis, the car market remains highly volatile. We will continue to closely monitor demand and take appropriate action to adjust volume to sales.”

Ian Williams, One North East’s director of business and industry, said: “This is very welcome news for the Sunderland plant at such a volatile time for the automotive sector.”

The global plunge into recession and the dramatic decline in new car sales has seen the Japanese manufacturer cut 1,200 jobs from its 5,000-strong North East workforce, although the firm has avoided any compulsory redundancies.