Japanese car manufacturer Nissan has confirmed that it will not be closing its Sunderland factory, following months of uncertainty surrounding a potential Brexit agreement.

Ashwani Gupta, Nissan’s chief operating officer, said that the agreed trade deal between the UK and the EU had created a positive environment, adding that: “Brexit gives us the competitive advantage not only within the United Kingdom but outside the United Kingdom also.”

As a result of the deal, Nissan also has plans to move electric battery production to the plant, which currently produced and imported from Japan.

Gupta said: “We’ve decided to localise the manufacture of the 62kWh battery in Sunderland so that all our products qualify [for tariff-free export to the EU]. We are committed to Sunderland for the long term under the business conditions that have been agreed.”

The chairman of Nissan Europe, Gianluca de Ficchy, had previously warned that a no-deal Brexit agreement would put the future of the Sunderland plant and the wider European operation in jeopardy.

Commenting on the news, Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT), said: “The news that the UK will be home to additional battery production in the North East is hugely positive and an essential step in the transformation of the automotive sector to electric motoring. It is an investment that is a direct consequence of the UK agreeing a deal with the EU and providing a much-needed boost to the sector and region.

“The Road to Zero will require a rapid acceleration in the take up of these new technologies and massive investment in infrastructure and local capability. We have the scale – as a market and as a production location – to warrant the necessary investment but our attractiveness depends on maintaining these advantages and consistently enhancing our competitiveness. We need to build on this announcement, and implement a strategy which safeguards automotive manufacturing and delivers a rapid transition to the benefit of all of society.”