Nissan to Make New Car Model in UK

Oct. 27, 2016

The Financial Times reports:

"Nissan will build two new car models at its Sunderland plant, in a vote of confidence in the UK following the Brexit referendum that will also boost hopes that other carmakers with investment decisions coming up will locate work in Britain.

"The Japanese carmaker said on Thursday it would produce the new model of its Qashqai SUV at the plant, as well as the X-Trail SUV, which is currently made in Japan.

"It is the first UK investment decision by an international carmaker since the vote in June and was made following assurances from the prime minister to Nissan chief executive Carlos Ghosn that the company would be protected from its impact.

"Nissan’s Sunderland factory was opened in 1986 and is the largest car plant in the UK, producing more than 500,000 vehicles a year and employing 7,000 people.

"The company said the decision “follows the UK government’s commitment to ensure that the Sunderland plant remains competitive”.

"Mr Ghosn said he welcomed “Theresa May’s commitment to the automotive industry n Britain and to the development of an overall industrial strategy. The support and assurances of the UK government enabled us to decide that the next generation Qashqai and X-Trail will be produced at Sunderland.”

"Access to the European market is key to the future of the Nissan site: more than 80 per cent of its cars are exported. Mr Ghosn has described it as a “European plant based in Britain”.

"Although the vehicles are not expected to begin production until 2019, car companies must make investment decisions several years in advance.

"The addition of the X-Trail may mean hundreds of new staff. While one of the production lines at the plant runs three shifts around the clock, the second line only has two and may need to add a third.

"One manager at the plant said it was “excellent news given all the speculation after Brexit”.

"Mrs May described it as “fantastic news for the UK”.

"Other carmakers, including Toyota, Honda and Vauxhall, also face decisions about whether to make new models in the UK and may have to decide before trading arrangements are known.

"Britain’s car industry has had a renaissance because of investment from international carmakers, many of whom are heavily reliant on exports.

"In the nine months to September, the UK exported more than 1m cars, according to the latest figures from the SMMT, the UK motor body.

"Last year the UK produced 1.6m cars, and is on track to hit record production levels of 2m by the end of the decade.

"After the referendum, Mr Ghosn said he would not invest unless the government offered to compensate the industry for the cost of new tariffs it might face."

Source: The Financial Times, 27 October 2016 


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