EC to probe Nissan grant plan

THE European Commission is formally investigating a £40 million grant to Nissan proposed by the Government to help keep new Micra production in Sunderland. The plant faces strong competition from other European factories, and Nissan UK has launched a series of initiatives to cut production costs by 30% and boost efficiency in order to win the business.

Rivals includes Nissan's Barcelona site and Renault's Flins factory - the latter currently makes Clio, which is to share a platform with the new Micra. The EC said it had decided to investigate the UK plan as it has doubts on the necessity and proportionality of the aid, the eligibility of costs and the effects on the production capacity.'