A NORTH-EAST factory will today earn a place in motoring history when it starts production of the world's first mass-market electric car.

Staff at Nissan in Sunderland have been working around the clock to set up new lines and a high tech battery plant for the all-electric Leaf hatchback.

Nissan's decision to choose Sunderland for the landmark project is seen as a major vote of confidence in its North-East workforce. The Japanese company has invested £420m in plant and machinery to make up to 50,000 Leafs a year in the North-East, creating 560 direct jobs and about 2,000 in the supply chain.

It has been backed with cash from the Government's regional growth fund.

Prime Minister David Cameron said: "Nissan's record breaking year last year is a success story for UK volume car manufacturing and demonstrates how our automotive industry is competing and thriving in the global race.

"I warmly welcome the production of the new electric Leaf model and battery plant at Sunderland.

"Nissan's announcement shows the confidence the company has in the skills-base and the business environment in the UK and that the UK is open for business."

Mr Cameron added that the new jobs would help people in the area "who want to work hard and get on".

Sarah Green, the CBI's director for the North-East said today was a landmark day for the UK car industry.

Until now, the Leaf has been built solely in Japan, but production of the new model will put the North-East at the forefront of a revolution in motoring.

The five-seater hatchback, which goes on sale this summer, can travel about 125 miles on a single charge. It is powered by lithium-ion batteries which are being made at a new purpose-built facility adjacent to the Sunderland plant.

Since its launch two years ago, more than 50,000 Leafs have been sold worldwide and it won the 2011 World and European Car of the Year Awards. However, sales have been lower than Nissan hoped and a major marketing campaign is planned.

In response to feedback from owners the revamped model being made in Sunderland boasts a host of new features, including more interior space, faster charging time, more gadgets and the capability to travel longer distances between charges.

Andy Palmer, Nissan's executive vice president, said: "Today's announcement progresses Nissan's unwavering commitment to zero emissions motoring.

"The Nissan Leaf is our most technically advanced car yet and the launch of this new model, built along with its batteries in Sunderland, is a huge boost not only for the plant but for British manufacturing.

"We have been showing that you can operate a world-beating plant in the UK for almost 30 years and the construction of the battery plant is a vote of confidence in the country's ability to support high-technology manufacturing."

More than seven million vehicles have been made on the site since its opening in 1986.

The plant, which employs 6,100 staff, makes more than one third of the 1.46 million cars manufactured in the UK a year - and is nearly double the number produced by the next largest competitor, Land Rover.

The launch of the Leaf follows deals for the Sunderland workforce to make new models including the Nissan Note, the popular Qashqai, and a sports hatchback under Nissan's premium brand, Infiniti.

This morning, Andy Richardson, Business Editor of The Northern Echo, will be at Nissan in Sunderland to see the first Leafs roll off the production line. Follow him on Twitter @bizecho or go to www.thenorthernecho.co.uk for news on the dawn of a new era in car manufacturing.