Vauxhall's Ellesmere Port factory has been saved after owner General Motors announced a £125m deal to build the next generation Astra at the plant.
The move will create 700 new jobs and safeguard over 2,000 existing roles.
The turnaround signalled a "historic day" for Ellesmere Port said Vauxhall chairman Duncan Aldred.
Production on the new Astra is set to begin in 2015.
The deal could also create 3,000 jobs in the UK automotive supply chain, Vauxhall claimed.
The announcement drew praise from the Institute of Mechanical Engineers. Philippa Oldham, Head of Transport and Manufacturing said:"This is welcome news for Merseyside, and for UK manufacturing as a whole. The UK car manufacturing industry is seeing a much needed renaissance, leading to the UK's first trade surplus since the 70s."
She added: "The UK has some of the most cutting-edge and innovative manufacturing in the world and it is heartening that companies like General Motors recognise this."