Nissan's Chief Operating Officer has warned that the company's UK plant will not be sustainable if the country leaves the EU without a trade deal in place.
Nissan factory, Sunderland, UK
Nissan's factory in Sunderland, UK
Ashwani Gupta made the comments with just a matter of days left for negotiators to come to an agreement of the terms of trade that will be applied after the UK's official departure from the EU on 31 December.
"If it happens without any sustainable business case obviously it is not a question of Sunderland or not Sunderland, obviously our UK business will not be sustainable, that's it," Gupta told Reuters.
"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."
Nissan employs more than 7,000 people at its factory in Sunderland which is considered to be one the most productive and advanced car plants in Europe. More than 10 million cars have been built there since 1986 and the factory is a key part of the region's economy, supporting thousands of jobs within the supply chain.
The Japanese carmaker has made several warnings about the difficulties that would be presented if tariff-free access to the EU ends.
A new hybrid version of Nissan's Qashqai is scheduled to begin production at the Sunderland plant next year, as well as Leaf and Juke models which are already rolling off the production lines.
These future plans remain in doubt, however, with the mid-November deadline for negotiations stretched, the two sides had hoped to reach an agreement by next week, which would give time for it to be ratified by the European Parliament before the December 31 deadline.
To add further pressure, negotiations have been temporarily suspended after it emerged yesterday that one of the EU's negotiating team had tested positive for Covid-19, forcing chief negotiator Michel Barnier and other team members to go into self-isolation.
In an attempt to meet the deadline, both sides agreed that video conference negotiations would continue, with UK officials expected to leave Brussels today.
When questioned about the comments by Nissan's COO, the prime minister's official spokesperson's, as quoted in The Independent, was:
“We continue to work as we have done throughout the negotiations this year to try to reach a free trade agreement based on zero tariffs and zero quotas. That continues to be our aim. That is why David Frost and his team are in Brussels this week trying to secure that.”
The Nissan plant in Sunderland has often been drawn in to the Brexit conversation. In 2016, former Nissan boss Carlos Ghosn warned that there could be no guarantee as to the company's future in the UK if tariffs were imposed.
The previous government, led by Theresa May, made assurances to the company in an attempt to secure the plant's future, though refused repeated requests to publish the details of any promises that were made. It later emerged that the package of sweeteners included £80 million (€89.5 million) of support for skills, training, and research and development, so long as Nissan agreed to build its new Qashqai and X-Trail models in the UK. The company ultimately decided to build the X-Trail in Japan.
Despite the company's reservations about the continued uncertainty of the UK's trading relationship with the European Union, Nissan said in March that it would forge ahead with a £400 million (€448 million) investment plan at Sunderland. Less than two weeks later, production at the plant was suspended after the coronavirus outbreak caused demand to plummet, created difficulty in importing components from Japan, and leading the government to impose the first lockdown.
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