Japanese car giant Nissan has announced it's changing its decision to produce the new X-Trail 4x4 in the company's Washington plant in Tyne and Wear, North East England with production remaining in Japan instead.
The decision was announced with less than two months on the calendar before the UK is scheduled to leave the EU, adding further fuel to the Brexit debate.
While a company spokesperson had said that there would be no comment on rumour and speculation, chairman of Nissan Europe Gianluca de Ficchy said: “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.”
Source: Andrew Yates/Reuters
Nissan Sunderland plant
Nissan plant in Sunderland, Source: Andrew Yates/Reuters
Nissan announced its decision to produce the X-Trail at the Washington plant in October 2016, just a few months after the vote. At the time, it was lauded by the government as a show of confidence in the UK, such a short time after the referendum result which shocked Japanese car manufacturers. UK Prime Minister Theresa May had been personally involved in lobbying Nissan, giving assurances to the then CEO Carols Ghosn that Brexit would not harm the company or its supply chains.
The Washington plant is located close to Sunderland, a city that voted by 61.3% to leave the EU in the 2016 referendum, despite warnings prior to and after the vote that car manufacturing would be affected by a vote to leave.
7,755 workers are employed at the plant with a further 30,000 regional and national supply chain jobs. While there gave been no job losses announced, the decision has cast doubt on the long-term future of the plant.
Uncertainty around Brexit was not the only factor to play a role in the decision. There has been a slump across Europe in diesel vehicles, in part due to the Volkswagen emissions-cheating scandal, which has damaged public trust in the industry as well as leading to much closer political scrutiny of diesel's environmental impact.
Demand for the diesel Qashqai, currently produced at the Washington plant has halved in the past two years with overall production at Nissan falling by 10.7% in 2018.
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