FEARS were growing last night that Sanyo could be about to shift production of microwave ovens from the North-East to a rival plant in Wales.

The Northern Echo understands that under the terms of a new agreement with Sharp, production could now take place at its facility in Wrexham, North Wales.

This would replace the factory at Newton Aycliffe, currently under threat of the axe, and where 284 staff are employed.

Sanyo announced last week that it was beginning a consultation process on the future of the Aycliffe factory and its sister plant on Thornaby, Teesside.

The company said it had been hit by cheap Far East imports and that "continued manufacturing within the UK was not currently sustainable".

But within days, Sanyo and rival Sharp announced in Japan that they had agreed a tie-up to develop a strategy for worldwide business in the appliance market.

This means that both will supply each other's products under their own brand names.

Last night, Bob Cooney, of the Amalgamated Engineering and Electrical Union (AEEU), said it was concerned about the whole consultation process.

The union intended to make a personal plea to Prime Minister Tony Blair in a bid to save the North-East jobs.

Mr Cooney said: "We hope he will be sympathetic as this is going on in his back yard. We have got misgivings about the whole alliance between Sanyo and Sharp, but it is too early yet to start panicking."

Independent Aycliffe county councillor Don Fraser said: "This would just be rubbing salt in the wound."

David Simpson, general manager of Sanyo Electric Manufacturing UK, said the exact workings of the new partnership were still at the discussion stage.

But he added: "A conclusion that could be drawn is that Sanyo is closing down its Aycliffe facility and transferring production to Wrexham."

A Sanyo spokesman said he could not confirm the switch of production to Wrexham. Economies of scale were thought more favourable at Wrexham as it was able to turn out a bigger volume of production, he added