LONDON - JAPANESE car giant Nissan said on Thursday it would cut 1,200 jobs in Britain due to a sales slump caused by the global economic slowdown, in the latest economic blow for the country.

The jobs will go at the firm's plant in Sunderland, northeast England, which has around 5,000 workers and is one of the biggest employers in the region.

'Like all manufacturers, the Sunderland plant is currently operating in extraordinary circumstances not of our making,' said Mr Trevor Mann, Nissan's senior vice-president for manufacturing in Europe.

'It is essential we take the right action now to ensure we are in a strong and viable position once business conditions return to normal. Unavoidably, this means we have had to make some very tough decisions in recent weeks.

'However by doing so, we are helping to safeguard our long-term future which I believe is extremely positive.'

Nissan said the outlook for the car market this year remained 'extremely challenging', adding that it was committed to taking the right action now to safeguard the plant's long-term sustainability.

'The long-term future of the plant must remain our over-riding priority,' Mr Mann said.

Work at the production line only resumed on Monday after an extended Christmas shutdown in response to the slowdown in car sales.

Production had been halted on December 18, five days earlier than expected, after a surprise shutdown the previous week.

Nissan said there had been a 'dramatic decline' in customer demand towards the end of 2008 which had affected all car makers.

New car sales in Britain alone dropped 11 per cent in 2008, according to figures published by the Society of Motor Manufacturers and Traders (SMMT) on Wednesday.

Nissan sold 66,336 new cars in Britain last year, just 0.14 per cent fewer than in 2007.

But as the economic crisis began to bite, its sales for December fell 26.68 percent compared with the same month in 2007.

When Nissan chose to locate the plant in Sunderland in 1986, it came as a rare boost for an area of England that was blighted by unemployment.

Mr Derek Simpson, joint general secretary of the Unite union, said the job cuts were 'devastating news for the workers and their families.' He said: 'Today's announcement shows just how serious Britain's economic difficulties are.'

It has been a grim week for job losses in Britain, where the Bank of England cut its key lending rate on Thursday to 1.5 per cent, the lowest level in its 315-year history, to ward off any threat of deflation amid the downturn. -- AFP