A STEEL firm says it is emerging from the recession after cutting losses and increasing production.

Tata Steel, which employs 1,500 North-East workers, says European losses for the year to March 31 fell to £16m from £283m.

Bosses say the improvement has been helped by Eurozone economic growth and a strengthening automotive sector.

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Tata supplies Sunderland car maker Nissan with steel for its all-electric Leaf and Qashqai models to lift fuel economy, and worked with JCB Landpower to create a lighter tractor capable of handling larger loads.

It says its focus on new products will be intrinsic to its success.

The firm's results showed European liquid steel production increased 16 per cent to more than 15 million tonnes in the year, with deliveries rising six per cent to 13.8 million tonnes.

Group profits stood at £360m in the period, with steel deliveries standing at more than 26 million tonnes.

The company has factories across the North-East, including the Teesside beam mill, in Redcar, which rolls and finishes construction steel sections, Skinningrove, in east Cleveland, which provides steel for track shoes on earthmoving vehicles, and the Hartlepool pipe mill, capable of supplying steel for energy projects.

Dr Karl-Ulrich Köhler, Tata Steel's European managing director and chief executive, said: “Europe appears to be entering a phase of solid economic growth, which is supporting a recovery in steel demand.

“But EU steel use will remain at low levels historically against a background of continuing global overcapacity.

“The key to last year was our relentless focus on operational reliability, which enabled production to return to more usual levels.

“Our financial performance improved as a result and we also launched 30 new products, increasing sales by more than 75 per cent.

“By intensifying innovation, sales to automotive manufacturers grew against trend, with a third of sales helping customers deliver cost, weight and performance improvements.”

Earlier this year, Dr Köhler led calls for the Government to save the North-East's manufacturing heritage by appointing a manufacturing minister to plug a widening North-South divide.

He added: “If the Government is serious about re-balancing the economy and creating sustainable regional jobs, it must recognise the importance of the UK's foundation industries.

“We're not asking for handouts, but we deserve a level-playing field and an equal seat at the table.”