Thousands of jobs at Honda's Swindon plant are safe despite the Japanese car firm's shock decision to abandon production of its planned super-mini there.

The plant, which employs 3,000 staff, will instead become a major base for making the next generation of the highly successful All-Wheel Drive CR-V, not just for Europe but for export to the US as well.

And the fact that the plant is to accelerate its programme for full production capacity of 250,000 vehicles a year has also been hailed as good news, with the company still set to increase its workforce by another 500.

Swindon-based automotive industry expert Chris Firth said: "This puts the South Marston operation at the forefront of Honda's global strategy and really is a reflection of the esteem in which its workforce is held both inside and outside the company.

"To do this entails making full use of capacity at the present factory and a second one being built, which is scheduled to be operational next year.

"The fact that the previously announced all new super-mini, which was to have been built at the new factory, has been postponed, is neither here nor there.

"The many millions Honda has invested in its Swindon operation must be made to pay, sooner rather than later.

"With that and the continuing strength of sterling and weakness of the euro, priority has to be given to production of a known best-seller."

Commenting on Honda's announcement, Sir Ken Jackson, general secretary of the Amalgamated Engineering and Electrical Union, said: "Thankfully the company has said that their commitment to the UK remains rock solid and that no jobs will be lost.

"But we are disappointed that the new super-mini will not be built at Swindon.

"This shows that unless we join the euro, we will become uncompetitive and find it more difficult to export into Europe.

"Most companies will not be able to switch markets like Honda and job losses will undoubtedly follow."