More than 1,000 more jobs are set to be created with the announcement that Nissan is to produce another new model at its Sunderland car plant.
The news comes just a month after it was revealed that Wearside will also built a compact car based on the Invitation concept from next year.
The latest announcement for a medium-sized hatchback was made by prime minister David Cameron and Nissan chief operating officer Toshiyuki Shiga during a visit to Nissan's headquarters in Yokohama, Japan.
When production begins in 2014, the plants two production lines will be operating around the clock for the first time in the its 26-year history, taking manufacturing capacity beyond 550,000 cars a year.
The new medium-sized model will create an additional 225 jobs at the factory and 900 at component companies supplying Nissan.
Once recruitment is complete, the Sunderland Plant workforce will stand at a record 6,225.
A company spokesman said that the new hatchback, which will be named closer to its sales launch, marks Nissan's return to the mainstream medium-sized hatchback market in Europe.
The announcement also consolidates the Sunderland Plant's position as the UK's largest car manufacturer, a title it has held since 1998.
In 2010 Sunderland became the first and only UK car plant to produce more than 400,000 units in a single year when 423,000 Qashqais, Notes and Jukes rolled off the line.
The new hatch represents an additional £127m investment by Nissan in its Sunderland operation and is supported by an offer of £8.2m Regional Growth Fund from the UK Government.
Nissan Chief Operating Officer, Toshiyuki Shiga, said: "Nissan already produces more vehicles in Europe than any other Asian manufacturer and the model announced today will bring world-class quality and leading technology to our customers.
"I would also like to thank the UK Government for its strong and sustained support which allows us to continue making significant, long-term investment in our Sunderland operation.."
Mr Cameron added: "It is fantastic news that Nissan will be building their new hatchback model in the UK and that they expect to create more than 1,000 jobs at the Sunderland plant and in the supply chain across the country.
"Nissan's investment in the UK is a huge vote of confidence in the skills and flexibility of the UK workforce. We want to attract more investment like this and that's why we're encouraging foreign companies with incentives like the Regional Growth Fund."
The announcement comes during an unprecedented period of investment in Sunderland Plant in recent years totalling £921m.
This includes introduction of the 100% electric Nissan LEAF in 2013; Juke launch; the construction of a battery plant and the replacement for the Qashqai crossover - in addition to the two recent model announcements.
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