Brexit plays role in Nissan’s X-Trail production U-turn
Nissan has confirmed that it’s axeing plans to move production of the next-gen X-Trail for the European market to Sunderland in the UK as it says that Brexit uncertainty has had a hand in the decision.
The carmaker committed in October 2016 – four months after the Brexit referendum – to switching production of the X-Trail at the plant, following assurance from the Government of the continued competitiveness of the UK operation, and said it would increase its investment in the plant. The Government is also believed to have outlined a support package.
However, Nissan has now said it’s decided to consolidate X-Trail production in Kyushu, Japan, which means it can reduce its upfront investment costs.
The decision is due in part to declining diesel sales as well as global downturns in car sales, including in China.
But Nissan Europe chairman Gianluca de Ficchy added: “While we have taken this decision for business reasons, the continued uncertainty around the UK’s future relationship with the EU is not helping companies like ours to plan for the future.”
It follows ongoing calls from the Society of Motor Manufacturers and Traders (SMMT) for the Government to avoid a no-deal Brexit. Research by the SMMT has indicated the catastrophic effects of such a no-deal scenario, with three-quarters of carmakers in the UK saying in latest analysis that a ‘no-deal’ Brexit would hit their business, impacting on profitability and future investment.
Nissan said the move does not affect production of the next-generation Juke and Qashqai, due 2019 and 2020 respectively, which will continue to be produced in Sunderland.
Gianluca de Ficchy continued: “We appreciate this will be disappointing for our UK team and partners. Our workforce in Sunderland has our full confidence, and will continue to benefit from the investment planned for Juke and Qashqai.”
Nissan executive vice president for manufacturing and supply chain management, Hideyuki Sakamoto, also commented: “A model like X-Trail is manufactured in multiple locations globally, and can therefore be re-evaluated based on changes to the business environment. As always, Nissan has to make optimal use of its global investments for the benefits of its customers.”