NISSAN is to confirm that the new Micra will be built at its Sunderland plant, following European Union approval of a £40 million government grant. Prime Minister Tony Blair announced the decision this morning, ending months of speculation, which intensified with General Motors' shock decision to close its Luton car plant late last year.

Although Sunderland is the most productive car plant in Europe, it was feared Renault's controlling interest in Nissan could influence the decision, switching production of the supermini to Renault's Flins factory. The new Micra will share its platform with the next generation Renault Clio.