Outlook: North-east drives off with title again

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The Independent Online
HA'WAY THE LADS. Nissan might have been rescued by Renault, but when it comes to productivity its Sunderland car plant can still show the French - and everyone else for that matter - a clean pair of heels. The Japanese car manufacturer has become the Manchester United of the productivity league, winning the award for Europe's most efficient car plant with boring regularity. As fast as the rest try to catch up Sunderland, as David Coleman would say, simply opens its legs and shows its class.

The latest figures from the Economist Intelligence Unit, showing that Sunderland produced 105 cars last year for every productive worker, stand comparison with Nissan's most efficient car plants in Japan and knock spots off anything America, the world's most efficient nation, can offer. By contrast, the best the French can do is the 68 cars per employee driven off the line last year at Renault's Douai plant.

Of course, it is not unalloyed joy for Nissan, because while the Sunderland workforce was setting new production records, its dealerships were finding it harder to actually shift the metal. Sunderland's profits last year bore the scars of the strong pound, which made life difficult for a manufacturer that sells two-thirds of its output abroad.

But Gordon Brown and Eddie George could do worse than pay a visit to Sunderland - always assuming the Bank of England Governor is allowed across the county line again.

The Chancellor has flagellated British industry for its poor productivity record at every opportunity, finally putting his best men (McKinsey & Co) on the case. Meanwhile, there is barely an Inflation Report that goes by without the Bank staring glumly at the productivity figures and bemoaning our under-achievement. The blame is generally put on Britain's relative lack of investment, in both human and physical capital. Here is where Sunderland becomes an interesting case study. Its 4,200 employees are among the best paid in the car industry and the Japanese invest an inordinate amount of time on recruitment and training.

And yet the absolute levels of investment in the plant are not that high. The level of automation is modest by the standards of many car plants and next year's step change in output, when the new Almera starts production, is being achieved without any investment in additional capacity.

BMW, whose Rover subsidiary has slipped further down the productivity league, could do worse than to learn from that.

More than half the pounds 3.3bn that BMW intends to spend on Rover over the next six years is destined for Longbridge, where productivity is less than a third of that at Sunderland.

If Longbridge can be made to operate efficiently and build cars that people want to buy, then the Chancellor and BMW will both be very happy.