Unipres has already told all of its 200 temporary workers they are no longer needed, and now wants to make a further 96 full-time staff redundant.

The company makes car parts, predominantly for Nissan, and its factory is sited next to the Japanese car maker, off the A19.

A spokesman for the company, which has been trading since 1999, said the global downturn and drop in people buying new cars had hit them hard.

He added: "We're affected pretty much the same as everyone else in the industry.

"We are expecting a significant downturn in sales this year and we are having to adjust our manpower accordingly.

"Unfortunately, that is what we need to do to survive."

Staff say this is the worst time of year to be told your job is at risk, with thousands more people every week joining the dole queue.

Woolworth's last remaining UK stores will close at the end of trading today, marking the end of a High Street giant and the loss of 27,000 jobs.

Marks & Spencer is also reported to be ready to announce massive staff cuts tomorrow after a poor festive period.

Other retailers are also under severe pressure, including fashion chains Debenhams and Next, which have stores in Sunderland, who today revealed poor Christmas trading figures.

Next announced that its sales had dropped 7 per cent in the six months to Christmas Eve. However it added there had been a good start to its sale.

Meanwhile, Debenhams said its sales in the past 12 weeks had fallen 3.3 per cent.

It said this had been a "creditable sales performance, given the extremely difficult and volatile conditions seen across the High Street".

Union Unite is representing Unipres staff as consultation over redundancy packages begins.

The company is looking for voluntary redundancies at first but may have to make some compulsory redundancies if volunteers are not found.

The spokesman added: "Obviously we have communicated the situation to our employees on several occasions and they are well aware of the situation faced by the company.

"They know we are doing all we can to keep things going over a really difficult period."

Brian Cole from Unite said the first redundancy will be on January 31, and the company is looking to make the last redundancy by April 30.

Consultation started on December 22 with union representatives at the plant and a first meeting is expected to take place next week.

Temporary staff were informed just before Christmas they would not be needed in the New Year.

Mr Cole said the reduced workload at Nissan had affected the plant, which is based on Cherry Blossom Way.

One disgruntled worker, who did not want to be named, said: "Full-time staff were given a briefing and we were told 96 permanent staff are going to go, the details of which we would find out when we got back after Christmas.

"It's very worrying because if they do not get the volunteers they're going to have to make compulsory redundancies and that could be anybody."

Nissan finished production on five days earlier than expected over Christmas after a shock shutdown on December 9, amid the global economic crisis.

Production of the Qashqai, Note and Micra resumed for four days from December 15, before the plant closed early for the festive season.

Work resumed as normal yesterday.