Nissan wants guarantee of Brexit compensation before investing in Sunderland plant, says boss

Nissan will ask the UK Government to pledge compensation for any extra costs as a result of Brexit before it invests in its Sunderland plant, says the car giant’s boss.

Nissan builds around one in three of all of Britain’s total automotive output at Sunderland.

The company employs nearly 7,000 people at the Wearside plant.

Asked at the Paris Motor Show what factors the company would consider in deciding where to build any future model, company boss Carlos Ghosn told said: “If I need to make an investment in the next few months and I can’t wait until the end of Brexit, then I have to make a deal with the UK government.

“You can have commitments of compensation in case you have something negative. If there are tax barriers being established on cars, you have to have a commitment for carmakers who export to Europe that there is some kind of compensation.”

His remarks indicate a growing concern among global carmakers that Britain could be heading towards a so-called ‘hard Brexit’, which would leave them paying tariffs to export UK-assembled cars to EU markets.

Mr Ghosn told reporters that the Sunderland plant would lose competitiveness if Britain was left dealing with the EU under World Trade Organisation rules – rather than as part of the Single Market – which would effectively add 10% to the cost of a UK-built model.

The plant’s future could “without any doubt” be harmed unless there was a way to overcome the extra cost, he added.

Ghosn’s ultimatum echoes concerns from fellow Japanese carmaker Toyota which said the imposition of duties as part of a Brexit deal would make running its English plant “very, very tough.”

Britain’s business ministry did not offer an immediate comment when contacted. Around 814,000 people in Britain depend of on the country’s overwhelmingly foreign-owned car industry for jobs, according to the Society of Motor Manufacturers and Traders industry body.

The June 23 Brexit vote took many investors and chief executives by surprise, triggering the deepest political and financial turmoil in Britain since the Second World War and the biggest ever one-day fall in sterling against the dollar.

Prime Minister Theresa May’s government has tried to reassure major manufacturers that Britain is open for business and that it will take their views into account during the country’s negotiations on new trade relations with the EU.

“The UK government is talking with all the investors in the UK and saying: ‘OK, where are you concerned? What kind of problems do you have? What would make you stay?’ And we’ve been very clear,” Ghosn said. “They will take this into consideration, build a policy, and as a function of this policy we will make a decision.”

Leave a Reply