Nissan wants Labour to work towards agreeing a Brexit deal with Theresa May, the business secretary claimed after the carmaker scaled back planned UK investment amid uncertainty over EU withdrawal.

Greg Clark said a “senior executive” at the Japanese firm told him on Sunday to “please pass on the view to your opposition that they need to meet in a way that forms a deal”.

Jeremy Corbyn has already held talks with Theresa May over the Brexit deal but shows no sign of backing it unless she pivots towards a customs union with the EU.

But Clark said the car industry backs the prime minister’s deal as he warned a no-deal Brexit would be “ruinous for our prospects”.

May has already made clear her desire to win over Labour MPs as she tries to build a majority for a deal.

But shadow business secretary Rebecca Long-Bailey insisted businesses had lost confidence in the government’s ability to handle Brexit.

Meanwhile, Clark revealed the firm would need to re-apply for government funding after deciding not to build new car models at its UK plan.

The business secretary had promised support of up to £80m back in 2016 as the government scrambled to reassure the car industry about Brexit.

But after the Japanese carmaker said it would no longer be building its X-Trail car in Sunderland, Clark said it would now have to reapply for grant funding.

He also revealed £2.6m had already been paid, which was used for training staff and environmental improvements at the plant.

The decision not to build the car in the north-east means 741 additional planned jobs would not longer be created.

In the Commons, Clark said: “Nissan confirmed that production of the new Qashqai, Juke and Leaf will continue at Sunderland and there are no implications of the decision for existing jobs at the plant.

“They also pointed out what they’ve said consistently since 2016, that a risk of a no-deal Brexit is a source of damaging uncertainty.

“While I’m pleased the decision taken in 2016 to build the Qashqai and secure the Sunderland plant is unchanged, it’s deeply disappointing to me and to the workforce that the extra jobs that would have come from the X-Trail will no longer be available.

“While the decision was made on broader business grounds, Nissan commented on the need for us to come together and to resolve the question of our future trading relationship with the EU.

“I believe their advice should be listened to and acted upon.”

Clark then criticised Labour for failing to back the Brexit deal, accusing the party of harming the interests of workers.

“Nissan and the UK automotive industry back the deal that the prime minister has negotiated.

“During all of Nissan’s 30 years in the UK it’s been able to count on a constructive support from all parties.

“Yet Labour’s frontbench has evaded having a policy on this vital issue for our country, hiding behind six tests that are a fake and a sham designed expressly to avoid a deal and they know it.”

He added: “In a call from Japan yesterday a senior Nissan executive had this to say to me – ‘please pass on the view to your opposition that they need to meet in a way that forms a deal’.”

Labour’s Long-Bailey said Nissan’s X-Trail announcement was a “bitter blow” to the north-east, the automotive sector and Britain’s industrial strategy.

She said: “Of course Brexit was not the only reason but it was pretty prominent in Nissan’s decision.”

Long-Bailey added: “The secretary of state’s quiet opposition to no-deal Brexit is of course well known but still the juggernaut of government chaos hurtles on.

“Even he must be suitably frightened today by the uncertainty being created by his government’s negotiating strategy.” 

She said a “tipping point” has been reached, adding: “His government’s handling of Brexit is undermining our industrial strategy. Businesses are no longer speaking out simply to highlight the future dangers of a badly handled Brexit, they’re now losing confidence in the government and taking real action to protect their businesses.

“Without real assurances from (Clark) and a firm commitment from him to take no deal off the table, it’s hard not to think that managed decline is indeed the government’s plan.”