Nissan is in talks to transfer production of two Renault models from Spain to its Sunderland plant, guaranteeing thousands of British manufacturing jobs and signaling the Japanese automaker’s long-term commitment to the UK’s largest auto plant .
Japanese and French groups are planning to shift production of the Renault Kadjar and Captur models as part of a global operations overhaul to be announced this month, according to two people familiar with the talks.
Sunderland’s future had been called into question after Britain’s vote to leave the EU, with Nissan warning that tariffs with Europe would put Britain’s export model “at risk”.
The Japanese automaker is poised to cut a fifth of its global production capacity and rework its manufacturing operations to stem a profit drain accelerated by the coronavirus crisis, according to three people familiar with the matter.
Nissan and Renault declined to comment.
Nissan CEO Makoto Uchida’s new strategy aims to draw a line in a tumultuous period that has involved the company beset by internal strife, the collapse of its profits and the deterioration of its relationships with the partner of the Renault alliance.
A judicious exchange of vehicle production with Renault, which is under discussion in Europe, would mean a healing in the partnership which was at one time the largest automobile alliance in the world.
Morale within the Japanese group remains low, however. Nissan told staff Thursday that US President José Luis Valls had resigned from the company, according to an internal document seen by the Financial Times, becoming the latest in a series of high-profile departures.
A major strategic overview by Uchida on May 28 will detail several changes, including a restructuring of his struggling European business, according to people familiar with the discussions.
As part of the changes planned for the region, Nissan would close its Barcelona van plant, relocate the production of its Navara van to South Africa, while a replacement for the e-NV200 electric van would be made in France in the Renault factory in Maubeuge. .
In return, Renault would cease production of two popular models in Spain and move them to the United Kingdom.
The Nissan plant in Sunderland has the capacity and the ability to manufacture the Kadjar and the Captur while they are seated on the same manufacturing system as its Qashqai and Juke vehicles manufactured at the British site.
People close to the talks have warned that talks are underway and that the plan may change in the remaining two weeks before the announcement. Elements of Nissan’s strategy were first reported on Thursday by Nikkei.
Nissan, which employed about 5,000 people in Spain, has already temporarily laid off about 3,000 people following the closure of the plant in Europe due to the virus.
It has also closed its Sunderland plant and does not plan to reopen the site until June.
Renault will announce an updated strategy and cost-cutting plan at a time similar to Nissan, when it should cut back on some of its recognizable but older models, focusing instead on sport utility vehicles and electric cars.
Nissan has invested more than £ 4 billion in Sunderland, which has a capacity of half a million vehicles a year but produced 350,000 in 2019.
The Japanese automaker is determined to protect the site, and has previously worked out plans to double the plant in the event of a Brexit without a deal, which would result in tariffs when exporting cars to Europe.