The battery powered all-electric vehicle the Nissan Leaf has won European Car of the Year.
The Leaf is to be manufactured at the Nissan car factory in Sunderland from 2013. Batteries for the car will be produced at the factory from 2012.
The move is expected to create 350 new jobs and safeguard hundreds more.
The car beat 40 combustion-engined cars. There has never been an electric vehicle nominated in the competition's 46-year history.
Sunderland-based Trevor Mann, senior vice president of manufacturing Nissan Europe, welcomed the award.
He said: "It's fantastic news to have a car which has really got the backing of the main European automotive journalists - it's the icing on the cake, really."
The Nissan Leaf is the world's first mass produced 100% electric family vehicle.
It will do 90mph and travel 100 miles on a full charge - as long as air conditioning or heating are not used.
The car goes on sale in Europe from January 2011
Nissan has been established in the UK since 1986.
The European Car of the Year Awards have been running for 46 years and the jury consist of European motoring journalists from Europe's best known newspapers and specialist magazines.