Nissan Cancels UK plans

07 February 2019

Nissan to keep the production of the X-Trail in Japan. Cancels UK plans. 


In October 2016, Nissan announced its intention to build the new X-Trail in Sunderland, along with the Qashqai, the Juke and the electric Leaf. 
Four months after the 2016 referendum, Nissan received assurances from the British Government that no additional tariffs or diplomatic red tape would be placed upon it as a result of the UK leaving the European Union.
 
As a result of those assurances, Nissan committed to produce the Qashqai in Sunderland, and to also move all production of the X-Trail to the plant. Nissan, now, however, have reversed this decision and have formally announced that it will not move the production of its X-Trail from Japan to Sunderland. 
 
Chairman of Nissan Europe, Gianluca de Ficchy, said in a recent letter to workers that much had changed since the Japanese firm announced plans to build a new Qashqai and X-Trail in the UK in October 2016:

"At that time they were both planned as 'traditional' models, powered by internal combustion engines. X-Trail was already going to be made in Kyushu, but there was a good business case for bringing production to Europe as well.
 
Since that time, as you know, the environment for the car industry in Europe has changed dramatically. To meet the changing emissions regulations we've had to invest much more in new powertrains for our future models like X-Trail.
 
At the same time, the volume forecasts for X-Trail in Europe have reduced.

For those reasons, the company has decided to optimise our investments and concentrate production in Kyushu, instead of adding another production site.

For the European business, this does not change the fact that X-Trail is - and will continue to be - a crucial model for us.

The announcement will be interpreted by a lot of people as a decision related to Brexit. We have taken this decision for the business reasons I've explained, but clearly, the uncertainty around the UK's future relationship with the EU is not helping companies like ours to plan for the future."


Sunderland Central Labour MP Julie Elliott said the "inevitable role" Brexit has played cannot be denied. She added: "The constant uncertainty, the chaotic Government. None of it is conducive to encouraging business investment in this country."

Whatever the associated explanations behind the X-Trail's production staying in Japan, Nissan's decision comes against a backdrop of declining investment in the UK automotive industry, which fell by 46.5% in 2018, compared to 2017.
 
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