NISSAN’S chief executive sounded an optimistic note for its Sunderland workforce yesterday, despite reporting annual losses of £1.58bn.

Despite the huge losses last year, in stark contrast to 2007’s £3.26bn profits, the news was better than expected.

And Nissan chief executive Carlos Ghosn was expecting a boost from the Government’s car scrappage scheme, which starts on Monday, which offers a substantial discount on a new vehicle in return for scrapping one at least ten years old.

He said: “The global economic recession and financial crisis continue, but we are beginning to see some signs of improved access to credit, the impact of Government stimulus packages and a gradual return in consumer confidence.”

Last week, Nissan announced a significant yearon- year increase in sales for April across Europe, as scrappage schemes began to take effect in France, Italy and Germany.

The Japanese car maker, which employs more than 3,000 workers on Wearside, said it hoped to narrow losses in the next year by £405bn.

However the company, which re-employed 150 temporary workers at Sunderland last week to meet a significant short-term rise in work, sounded a note of caution.

It expects to see sales fall again this year to 3.08 million cars.

Mr Ghosn said: “We remain cautious about the economic environment and fully focused on our company’s recovery efforts.

“2009 will be another challenging year. We are balancing short and long-term objectives to manage through the crisis and to prepare for the future.”

Nissan has been hit hard by the slowdown in global sales, and in January announced that 1,200 staff at Sunderland, almost a quarter of its workforce, would go.

A month later it announced 20,000 job losses globally over the next year to combat sliding sales.

But last week it announced it was targeting some of the 400 temporary workers at Sunderland who lost their jobs in January to fill 150 positions created to make an extra 14,000 Qashqai, Micra and Note models in the next four months, as the UK car scrappage scheme comes into effect.

Its sales in the year to the end of March plunged 22 per cent against the previous year to £57bn, although this was better than its initial forecasts.

Nissan sold 3.4 million vehicles worldwide during the year, down 9.5 per cent from the previous year, as sales dropped in the US, Japan and Europe.

Sales across Europe fell 16.7 per cent to 530,000 cars in one of the worst affected regions after the US, where the figure was down 19.1 per cent.

But sales grew in China, according to Nissan.

However it is maintaining an international launch programme with eight new models planned, including the Pixo in Europe.