Nissan to invest in UK battery plants

By John Bowker and Shrikesh Laxmidas

LONDON/LISBON (Reuters) - Car manufacturer Nissan said on Monday it will invest almost $700 million (424 million pounds) in two plants to make batteries for electric cars in Britain and Portugal after securing financial support from their governments.

Automakers around the world are exploring plans for mass electric car production as the industry seeks to haul itself out a devastating downturn.

The Nissan news comes less than a week after Toyota said it would produce its first European-built hybrid car in Britain from 2010. A hybrid car is part-powered by electricity and is more fuel efficient than traditional vehicles.

Nissan is the biggest car manufacturer in the UK by volume, while Toyota is the fourth largest.

Nissan will invest more than 200 million pounds ($328.6 million) in the plant near Sunderland, north east England.

"The two governments (UK and Portugal) have offered to extend financial assistance and other support to ensure that Nissan locates the proposed plants within their respective countries," Nissan said in a statement.

Nissan will also build a similar plant in Portugal as part of its plan to make and sell environmentally friendly electric cars. The location for the 250 million euro (215.4 million pounds) plant, which should create 200 jobs, is yet to be chosen.

Each plant would produce 60,000 batteries a year.