News : Nissan commits to post-Brexit UK production

Carole Nash Classic Insurance Specialists

nissan-qashqai-in-sunderland

Nissan has confirmed that the next-generation Qashqai and X-Trail models will be built at its Sunderland plant in Washington. The good news means that the factory, one of Europe’s most productive, will remain at the heart of the company’s European operations.

The decision follows the UK Government’s commitment to ensure that the Sunderland plant, which builds more than half a million cars per year, remains competitive when the country leaves the European Union. As a result, Nissan will increase its investment in Sunderland, securing and sustaining the jobs of more than 7000 workers at the plant.

Nissan’s Sunderland plant opened in 1986 and has produced almost nine million cars since. One in three British cars are produced in Sunderland, which is the UK’s largest car plant of all time, and 80 per cent of the plant’s output is exported to over 130 international markets. More than two million Qashqais have been built in Sunderland in less than 10 years.

‘I am pleased to announce that Nissan will continue to invest in Sunderland. Our employees there continue to make the plant a globally competitive powerhouse, producing high-quality, high-value products every day,’ said Carlos Ghosn, Chairman and CEO of Nissan.

‘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. I welcome British Prime Minister Theresa May’s commitment to the automotive industry in Britain and to the development of an overall industrial strategy.’

nissan-qashqai-in-sunderland-2

Keith Adams

Keith Adams

Editor and creator AROnline at AROnline
Created www.austin-rover.co.uk in 2001 and built it up to become the world's foremost reference source for all things BMC, Leyland and Rover Group, before renaming it AROnline in 2007.

Is the Editor of the Parkers website and price guide, formerly editor of Classic Car Weekly, and launch editor/creator of Modern Classics magazine. Has contributed to various motoring titles including Octane, Practical Classics, Evo, Honest John, CAR magazine, Autocar, Pistonheads, Diesel Car, Practical Performance Car, Performance French Car, Car Mechanics, Jaguar World Monthly, MG Enthusiast, Modern MINI, Practical Classics, Fifth Gear Website, Radio 4, and the the Motoring Independent...

Likes 'conditionally challenged' motors and taking them on unfeasible adventures all across Europe.
Keith Adams

39 Comments

  1. Great news, of course. It does leave open the question about the next Juke, which was due to launch before the next Qashqai. I assume that will be built somewhere else?

  2. Theoretically good news but it seems a bit odd that the Qashqai isn’t made in the same factory as the Renault Kadjar, similarly the X-Trail and Renault Koleos – possibly Ghosn is hedging his bets?

  3. I’m really glad Nissan will produce the next Qashqai and the X Trail in Sunderland. This will mean Nissan will continue as Britain’s biggest car producer and another vote of confidence in the country’s car industry.

  4. With Nissan producing 600,000 cars a year in the UK, the Nissan/Renault partnership will be very keen for a sensible trade deal between the UK and the EU, which may be useful for the British Government in its dealings with the French Government (which still owns a stake in Renault).

  5. Oh look, I was right, all that whingeing about brexit and they’re staying. I’m so surprised.
    But then they couldn’t do anything else, what with no spare capacity to makethe cash-n-carry etc, a huge great investment in the factory and, as I said before, a fair chance that the government had tied them down with qualifications on the original loan.
    In other news that Russian heap/aircraft carrier is doing well, at least it managed to avoid sinking fishing boats like the last time they dropped by. The massive amounts of smoke btw are caused by soft coal & forced draft (which has a similar effect on boilers as you would find if you bolted 4 turbo’s onto a 150,000 mile k series).

  6. If the value of the pound stabilises at its current new level it offsets the level of duty that would apply to UK manufactured cars shipped into the EU under WTO rules.

    However this ignores the problem of “duty stack” which arises when you make parts in one market and ship them to another, incurring duty, to go into a sub-assembly that then goes back again, incurring duty, to be built into a car for export, incurring duty again.

    While such issues can be solved by treaties, if people want to solve them, it all takes time as the Canada/EU treaty has demonstrated. The multi treaty Swiss approach could be more practical as it stops manufacturing issues being derailed by dairy farmers.

    My real concern is all of this takes time to resolve and from some of the public statements made by those in charge you get the feeling they have not grasped that yet.

  7. Good (and reassuring) news, despite the recent Brexit scaremongering rumours. As I live in the North East, the continued presence of Nissan will help employment at the factory and its suppliers. Also, jobs will be protected in the delivery chain, of car Transporters to Port of Tyne and the Car Carrying ships for export.

    The figure of 7,000 jobs is quoted at the factory. I was wondering how many are employed at Toyota’s, Honda’s & Vauxhall’s UK Plants?

    • @ Will… I sometimes see Qashqai’s on car transporters heading for Tyne Car Terminal wearing black steel wheels. I think some markets (eg Middle East)still have steel wheels with wheelcovers, stored in the Boot during delivery. Entry level models?

  8. All the doom and gloom spread about us leaving Europe yet as mentioned above we have a strong automotive industry. Yes the companies are not British, but then in my era we had American owners like Chrysler, Ford and GM. The wages still come into the British economy. Overall it looks very positive .

  9. I was quite convinced that Nissan would not turn their back on Britain in any case, despite the non helpful stance the government have been taking on Brexit issues. Hearing Lord Bamford (Head of JCB) talking in the lords this week has reaffirmed my conviction that the common market is not necessarily healthy for heavy British industry business in Europe. Aston Martin CEO Andy Palmers favourable Brexit discussions on CNN are also worth tuning into.
    I’m quite ready to take more flack and be proved right again..

  10. Not sure I trust Bamford’s views. Is he too focused on heavy industry? If so, frankly the UK doesn’t have enough of that. I’d hoped the lower pound would help manufacturing, but I understand UK manufacturing shrunk even more in the last quarter, with services bouying the economy. In my company [automotive related] we cannot understand what has made Nissan choose to make a massive investment in the UK: we cannot make investment arguments stack up unless we have a guarantee EU trade continues as normal. Have the government guaranteed this!? If so, they should do for us. And probably every UK industry. This needs to be done damn soon, as our EU ops will get all the investment growth and not the UK :-(.

  11. As far as I know UK-based Japanese car makers export more vehicles to USA then Europe, but overall the EU is a bigger market according to the SMMT. However, Sunderland is Europe’s most efficient car plant and the value of the GBP declining makes car producing in UK a win win situation at present.
    If I seem to remember we have the government partly to thank for Nissan setting up shop in 1986 in Sunderland.
    As for heavy industry Siemens has been helped out with wind farms and HSE2 train has had millions spent on it already before any type of serious ground work has begun. Though I agree with Bamford, if Britain has to pay for tariffs, this will be a price worth paying; by greatly reducing red tape restrictions in certain EU countries, which rely enormously on agriculture in rural areas, and this has to be better for British firms like JCB.

    • Sunderland welcomed Nissan with open arms when the factory was announced in 1984. You have to remember the city’s traditional industries were dying and over one in five people in Sunderland were unemployed. Nissan now is a far bigger success than the nationalised coal and shipbuilding industries ever were and makes money, rather than consuming it.

      • I’m not sure it is fair to compare Nissan now with nationalised shipbuilding and coal.

        By the time the shipbuilding industry was nationalised it was already in terminal decline. Given that Sunderland had been buliding ships since about 1346 – and at one time made about 25% of the world’s ships, it doesn’t seem fair to compare Nissan now to the last 15 years of shipbuilding there.

        Not sure about coal, but again I’m not sure the comparison is fair.

  12. When Nissan announced the next generation Micra (which will be built at the Clio plant) at the Paris Motor Show, they stated that the Note (which is built at Sunderland) will be discontinued, probably sometime in 2017.
    This will presumably leave spare capacity at Sunderland, which will be taken up by the X-Trail.

    • It might have made sense for the Renault Kadjar to be made alongside the Qashqai in Washington as they are similar, in the same way that the next Micra is similar to the Clio

  13. This is good news, but it relies on having no/low tariffs between the UK & the EU. If there are punitive tariffs, future decisions will still go elsewhere.

  14. The decision by Nissan is very welcome, but it might be too soon for people to claim they were right about Brexit.

    We don’t yet fully know what promises were made to Nissan by the government and after only 4 months and not having yet triggered article 50, we don’t know what the consequences of walking away from the world’s biggest single market will be.

    Put the Nissan decision in context: UK manufacturing is <10% of the economy, and Nissan is only a part of that. Hopefully, so long as the government & taxpayers can afford their promises, all the other auto manufacturers will follow Nissan's lead.

    In a year or two we'll have a better idea, but at the moment the overall economic signs are not so good.

  15. Here is a link to an interesting article in the Sunday Times Business section. I have to agree that the management, workforce and the supply chain have done a great job and produce a world class product in one of the World’s most efficient car factories. I can’t see Nissan moving to France or anywhere else.

    http://www.thetimes.co.uk/article/nissan-doesnt-need-a-bribe-while-its-got-our-world-beating-workers-t57vtt6k3?shareToken=1a380941ea5c8ac1fbdaf888e1cb6e20

  16. The investment in Washington (as it will always be to me) is excellent news for not just Sunderland and the North East but the UK as a whole. It is also great credit to the workforce and their families who support them.

    I am however sickened that there seems to be a significant number of people, including Labour politicians and the left wing media (Guardian, Observer and BBC), who seem to have wanted the factory (and others) to close to make a political point just to say ‘told you so’ following Brexit.

    Before anyone thinks it I an not a pro-Brexit fanatic and am probably the only person in the country who was ambivalent on the subject as I could see pros and cons for both sides of the arguement and think the economic outcome would be broadly similar irrespective of the vote. What I do believe is that all politicians and the media should support British business and not undermine it and if this means supporting them with investment or assurances then that can only be a good thing.

    • Can you please point to some evidence supporting your assertion and that shows any of those people or organisations want the factory to close?

      Given that the MPS in Sunderland are Labour, I don’t think they would want their constituents to lose their jobs. So which Labour MPS are you referring to and where did they say this?

    • Your not the only ambivalent one Andrew, I also think “in or out?” was a case of swings and roundabouts, a choice of whether we prefer a Brussels/Westminster coalition of misrule, or just one bunch of scoundrels in the South
      screwing the country into the ground.

      What amazes me is the speed at which a whole mythology of the golden age of EU rule has overwhelmed folk.

      In Sunderland, back in the ’80s, Austin & Pickersgill’s yardcould have been saved by a Dutch firm who had orders on the books but Thatcher’s lot had agreed to close UK yards to deal with EU overcapacity, which kept German yards open.

      More recently, not far from Washington, Twinings tea closed their Tyneside plant and moved the work to Poland using millions in EU Regional Development Aid. That’s not my idea of regional development.

      Then of course, there’s the fishing industry – British boats being destroyed while EU money paid for a Spanish fleet to decimate British fish stocks – at a huge environmental cost, to boot.

      From an ARG point of view, it’s worth reflecting that BMW were refused UK Gov’t aid for Longbridge following complaints from Porsche over EU competition rules. So what did the BMW do? Off to East Germany to set up a new plant using Gov’t assistance…

      • That’s why the EU as a whole is very unfair, and citing the reasons for those who have worked in the automotive industry like myself to vote out.
        Yet the leave campaign (which I didn’t listen to for their ambiguity and naivety on many issues) didn’t fully pick up on the fact that EU unfair competition behaviour was having a very damaging effect on other industry’s as well as automotive such as the fishing industry in the UK, as being an example of EU recklessness.

        • A point on tariff proposals for parts manufacture and car manufacture is there are thousands of categories, and not only in the automotive sector but including in foods, white goods and clothing among the rest; ranging in the UK from 5% to over 10%.
          If the EU does decide to put import tariffs on say UK cheese and vehicles to include components, then those countries i.e. France or Germany keep the money collected. Likewise, the UK would keep monies collected.
          I would say it’s common knowledge that the UK imports much more than exports so if there is any provocation from the EU, the UK could place massive 30% tariff on importers and utilize some of this to subsidize the exporters whom likewise would have to pay large tariffs to the EU on exports.
          The whole thing would be a fools errand with the EU losing out.

          • Can you explain that to me because I can’t see how that works, although I admit I don’t understand much about tariffs.

            If we use the example of a car.

            Your suggestion is that on an import price of a £20K car coming into the UK from the EU, a 30% tariff of £6K be imposed to make the cost to the UK dealer £26K?

            Then some of the revenue from the tariff could be used to reduce the cost of a UK car being exported to the EU so as to offset a tariff imposed as it arrives in Europe?

            Even if that is legal in world trading terms, wouldn’t that mean that British consumers are paying more to subsidise EU consumers? How long could we do that for?

            I’ve used the example of a car, but you seem to be suggesting we apply that to all EU imports and exports?

            But wouldn’t the effect be that if, again talking about cars, the base price of a car from the EU increased by 30%, people would just stop buying them because they couldn’t afford them?

            That would be a boom time for Kia.

  17. I’m no expert on the subject of tariffs. What I propose is hypothetical and you grasp the basic idea, but it would be really in the event that the EU want to play hard ball with the UK, depending on how trade relations carry on after basic terms have been agreed and in the event that the UK would have to pay tariffs no question. It may not necessarily be beneficial for UK business over a long period.
    At this time I don’t think anybody knows what kind of trading relationship we will have with Europe. The government are telling the UK and the world that they need to finalise ‘all things Brexit’ before triggering this article 50 – whatever doing so entails.

  18. Although it has been some time since this article attracted any comments and we are still possibly years away from finally leaving the EU or being able to form a rounded opinion on the positive or negative consequences, I thought this might be relevant as a marker.

    “UK car production falls for first time since 2009 as Brexit fears hit sales
    Total production of 1.67m cars falls below forecast, fuelled by 10% drop in domestic buyers”

    https://www.theguardian.com/business/2018/jan/31/uk-car-production-falls-first-time-since-2009-brexit-fears-hit-sales

Leave a Reply

Your email address will not be published.


*


WordPress spam blocked by CleanTalk.

This site uses Akismet to reduce spam. Learn how your comment data is processed.