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Nissan reiterates Brexit closure threat for Sunderland car plant

Nissan Sunderland Juke crossover production

Nissan has warned that its UK car manufacturing plant in Sunderland may prove “unsustainable” if Brexit brings an end to the current tariff-free access to the EU.

The Japanese company's global chief operating head, Ashwani Gupta, also told the BBC that any plans for Alliance partner Renault to take up spare capacity at the plant – the UK’s largest car manufacturing facility – would be a matter for the French carmaker.

News of the uncertainty will be on concern to the Sunderland plant’s 7,000 workers who felt their jobs were safe after Nissan’s restructuring plan, announced last week, appeared to signal a long-term future for its UK operation.

Nissan announced plans to close its Barcelona site in a move which could cost €1.5 billion (£1.3bn) as it moves towards consolidation of its manufacturing operations amid reduced consumer demand.

In his interview with the BBC today (June 3), Gupta said that Nissan's commitment to the UK could not be maintained if there was not tariff-free EU access, however.

He said: "You know we are the number one carmaker in the UK and we want to continue. We are committed. Having said that, if we are not getting the current tariffs, it's not our intention but the business will not be sustainable. That's what everybody has to understand."

Gupta’s interview once again casts uncertainty over the Sunderland plant which has been the subject of much speculation in recent months – some of it extremely positive.

As recently as February of this year the Financial Times (FT) reported that Nissan is said to have drawn up a Brexit contingency plan which would see it close European manufacturing plants but drive UK market share to 20% with Sunderland-built products.

The FT reported on the plan, which would include a withdrawal from mainland Europe and a “doubling down” of its UK operations in the event that imports were hit by World Trade Organisation (WTO) tariffs.

Last year Nissan said that it had completed a £100m investment in its Sunderland plant as it prepared for the start of production of the new Juke SUV.

The plant also celebrated the production of its 10 millionth vehicle, 33 years after its first vehicle rolled out of the factory doors.

Speaking at the time, Steve Marsh, Nissan vice president for manufacturing in the UK, said: “We are thrilled to see the Juke in production.

“Our million Juke fans across Europe will be able to see it on the roads very soon.

“Juke is a big part of our plant’s heritage, so it is a proud moment to see the new model rolling off the line.”

Last week’s Nissan restructure plans outlined the OEMs plan to consolidate its European manufacturing operations as part of cost-saving measures designed to achieve a 5% profit margin within four years.

The Japanese manufacturer announced details of a restructure of its global operations following publication of its worst annual financial performance since 2008/09.

Nissan recorded a 40.5 billion Yen (£300m) operating loss in the financial year to March 31, 2020, after global retail sales volumes declines by 17.4%.

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