Nissan, the Japanese carmaker, is to halt production at its Sunderland plant for a fortnight as falling demand and the economic downturn prompt cutbacks across its global operations.

Japan's third-largest carmaker will also shorten working days for three weeks during late October and November at its plant in north-east England, its main production site in Europe, after a fall in sales of its Micra and Note models. A spokesman for Nissan in the UK said: "We are confident that these measures we have announced are better matched to customer demand going forward.

As to whether we have to take any more action in the future, it's difficult to answer because of the volatility of the market at the moment."
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About 5,100 people are employed at the Sunderland plant, and 850 staff will be affected by the non-production weeks. The spokesman said that there would be no job cuts among the permanent workforce, but that the company was predicting that a certain number of the 300 fixed-term contracts at the plant would not be extended.

The cuts in Sunderland are part of a wider scaling back of Nissan's operations.

In Japan, it will cut its output by 65,000 vehicles. Its plant in Barcelona will close for a week and operate shorter working days for eight weeks to reduce production of the Pathfinder, Navara 4x4 and Primastar van.

Last week, Nissan announced 1,680 job cuts in Barcelona.

In a statement last night the company said it was adjusting its European operations "in order to manage volume, reduce existing inventory and prevent over supply to a weakening market".

Honda, Japan's second-largest carmaker, also announced output cuts last night. It will reduce production of large-sized cars by 22,000 between November and March.

Few carmakers have escaped the impact of the economic slowdown. Nissan's sales in the US fell 34 per cent in September, to 59,565 vehicles. Earlier this month Toyota, Japan's leading carmaker, reported a 29.5 per cent fall in September sales in the US.

In the UK, other carmakers have already pushed through cuts in production.

At the beginning of October, Toyota halted the night shift at its Derby works, Ford announced that it would move to a four-day week until Christmas at its Transit van plant in Southampton, and Land Rover did the same at its plant in Solihull. In Crewe, Bentley’s factory has moved to a three-day week.

At the time, Roelant de Waard, chairman of Ford UK, said that consumers were unable to secure the loans required to buy new vehicles. “We assume demand will stay where it presently is unless something is done,” he said. “The affordability and availability of consumer credit has to improve.”