Nissan: British factory still threatened by Brexit without agreement

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Media captionThe Nissan plant in Sunderland is “unsustainable” without a Brexit trade deal, said Ashwani Gupta.

The UK’s largest car manufacturing plant is “unsustainable” if the UK leaves the European Union without a trade agreement, according to owner Nissan.

The Japanese company’s global chief operating officer told the BBC that people need to understand that the EU is the Sunderland plant’s biggest customer.

Ashwani Gupta said Nissan’s commitment could not be met without duty-free access to the EU.

Nissan has invested billions of pounds in the factory, which has 7,000 employees.

His comments come despite the Sunderland website which survived this week’s announcement of the Japanese giant’s global restructuring program.

Mr Gupta said: ‘You know we are the leading car manufacturer in the UK and we want to continue. We are determined. That said, if we don’t get the current rates, it’s not our intention, but the business will not be sustainable. This is what everyone has to understand. ”

Critical Talks

He also said that any plans to take up unused Sunderland capacity by its strategic partner and 43% shareholder would be the responsibility of the French automaker. The French government holds 15% of Renault’s capital.

This is not the first time that Nissan has pleaded with UK and EU negotiators to ensure that the 70% of cars made in Sunderland that are sold in the EU can avoid 10% tariffs according to the World Trade Organization rules – the default legal position if an agreement is not reached.

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These talks resumed this week, with the differences between the UK and the EU being described from all sides as deep and broad.

Last week, the EU’s chief negotiator, Michel Barnier, said that the EU would consider a two-year delay in Brexit, which was pushed back by its British counterpart David Frost, who told MEPs that the Government policy remained that the transition period should not be extended beyond the end of the year. .

Under an agreement signed last year, the UK has until the end of this month to decide if it wants to request such an extension. The coming weeks are therefore crucial.

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Nissan’s comments could dampen hopes raised last week when the company said that, while closing factories in Spain and Indonesia, it remained committed to Sunderland.

Nissan announcement that Renault could take the European lead in the global business manufacturing alliance (which also includes Mitsubishi) by taking an estimated 20% reserve capacity at Sunderland has been canceled for the foreseeable future by Renault this week when she said she had no current plans to move to the UK.

Growth in China

Gupta confirmed that any decision by his partners would be theirs and that no such agreement had been reached. “Regarding the distribution of manufacturing, each company will make the decision based on the competitiveness of the factories. “

Nissan is a big fan of the Sunderland plant and paid tribute to the efficiency and hard work of the operation. But he reiterated that this was not enough to secure his long-term future if tariffs were imposed on a market which he described last week as “non-essential”. It only has a 3% market share in the European automotive market.

On a more encouraging note, Gupta said recent sales figures from China show that the world’s largest auto market is recovering quickly and the company is gaining market share. But the vehicles for this market are not produced in the UK.

It is still possible that Renault may decide to shift production of certain vehicles to Sunderland. But it is difficult to see how a company owned 15% by the French taxpayer could find a way to make what Nissan, which has been in Sunderland for forty years, cannot do.

Nissan’s comments timely point out that for many key industries, the Brexit issue – which has not been silenced by the news on coronaviruses – has in many ways been magnified by it.

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