BRITAIN is home to some of the best and the worst car factories in the world.

Nissan's Sunderland plant is rightly lauded as the most productive plant in Europe, regularly topping the Economist Intelligence Unit's survey of the car industry's most efficient factories.

The 4,000-plus workers (actual workforce numbers vary according to demand) produce 98 cars per head each year.

Compare that to Rover's ancient Longbridge plant in the Midlands which manages only 33 vehicles per worker and is ranked as one of Europe's worst.

Before he was ousted, Ford boss Sir Alex Trotman cited outdated working practices as the reason for the poor performance of so many "traditional" car factories.

He may as well have added that a legacy of poor industrial relations also left many of the established big names playing catch-up with Japanese transplants such as Nissan Sunderland and Toyota's Derbyshire operation.

Nissan was hailed as a new model for industrial relations when it opened 18 years ago.

Out went the complex negotiating structure with different unions that made reaching an agreement so tortuous for the old guard management at such places as Rover and Ford.

In came a single union agreement with the AEU (now renamed Amicus), a works council - a largely non-union body - and management, who wore the same uniform as everyone else.

Under a complex bargaining arrangement, pay negotiations are conducted every two years via the council, which includes a handful of Amicus shop stewards.

The council acts as a go-between for management and staff, who vote on the pay offer factory-wide. Ballot boxes, which are guarded as per electoral reform society rules, are placed throughout the plant and everyone has a say. Unions and managers rarely meet face-to-face.

At the time this was introduced, traditionalists shook their heads in disbelief. Not only did the North-East have no experience of car manufacturing - a recipe for disaster if previous experiments such as the Triumph plant at Speke were to be any kind of guide - but a single union model would soon be rolled over. They were wrong.

The Nissan system worked and it worked very well.

Not only did production soar to previously undreamed of heights, but industrial relations were the envy of every other car manufacturer.

The model was eagerly seized upon by other car companies, who went further still by seeking no-strike deals; the so called "sweetheart" arrangement, whereby workers benefitted from better conditions provided they agreed not to down tools.

The thought of industrial action at Nissan seemed so remote as to be almost foolish. Cast in the role of benefactor to an area crying out for employment, no one was ready to push the button marked "strike".

Critics said this was precisely why Nissan chose Sunderland - because high unemployment meant it could more easily get its way with both workers and local government.

In 1994, Peter Wickens, a board director at Nissan UK, criticised unions for having no role in a modern, successful workplace.

He said: "When people say: 'I pay £1 a week for union membership and what do I get?' the answer is going to be: 'Not very much'.

"Until trade unions actually begin to define what is their role in an environment in which the pay is good, the conditions are good and people are treated with respect, it is going to continue to be not very much."

Until recently, union activity at Nissan has been low key. In 1993, the company asked for voluntary redundancies, staff left with nothing but a message of understanding from the AEU. Even when staff complained last year about new overtime arrangements, the union continued to maintain it had a great relationship.

Things began to change last year when the leadership of Amicus lurched to the left. Derek Simpson, the newly elected joint general secretary, said he would review the Nissan agreement.

Then in January, pay talks broke down, leading to a frantic round of negotiations with Acas to avoid a strike.

Now Nissan's decision to move its purchasing department to Cranfield - home to its Euro design and development centre - has led the company to the brink of its first strike.

Last night, there was still hope that a negotiated settlement could be found. If not, the union could find itself on a collision course with one of the biggest companies in the world.

Nissan has been down this road before, of course. Faced with major domestic strikes in 1949 and 1953, the company dug in and, with the help of a highly controversial breakaway union (motto: "Those who love the union love the company") destroyed the Zenji auto union.

Hopefully, wiser heads will prevail in 2003.