Published: Thu, February 07, 2019
Science | By

Japan's European Union deal 'threatens post-Brexit UK industry'

Japan's European Union deal 'threatens post-Brexit UK industry'

In October 2016, Nissan said it would build both the new Qashqai and the X-Trail SUV at its Sunderland plant, following government "support and assurances".

The Department for International Trade said its priority was to ensure there was no disruption to UK-Japanese trade after Brexit, but that it would then seek to go further than the deal signed by Brussels.

A source said Nissan received a letter from the government at the time promising extra support in the event that Britain's departure from the European Union hit the competitiveness of its Sunderland plant in north-east England.

The newspaper said the letter contained comments by Mr Clark that it would be "a critical priority of our [Brexit] negotiations to support United Kingdom vehicle manufacturers".

The carmaker's planned investment in the next-generation Juke and Qashqai models, which was also announced in 2016, was unaffected, the firm said on Sunday.

"We will set our ambitions high and vigorously pursue continued access to the European market as an objective in future negotiations", Clark pledged in the letter.

Clark said in the 2016 letter that government had already been able to confirm £22m of support for the foundry at Sunderland to become a European development centre for the firm's alliance with fellow carmakers Renault and Mitsubishi.

Nissan recently has confirmed that its new X-trail which was actually planned for the sunderland plant for it is now going to be made in Japan.

Clark told Parliament on Monday that as the terms of Nissan's investment had changed, they would need to re-apply for the funding.

"The letter, written in October 2016, shows Nissan and the United Kingdom government's continued desire to support investment in the United Kingdom and maintain Sunderland as one of Nissan's manufacturing hubs in Europe", the company said Monday.

The Nissan factory builds around 30% of the UK's 1.52 million cars, making it the largest vehicle factory in the country.

The company says falling demand for diesel cars in Europe had forced it to invest in other technologies as the segment is hit by levies and crackdowns, warning two months before Brexit that uncertainty is also making plans harder.

Nissan had pledged to manufacture the new SUV model in the United Kingdom four months after the referendum - a move seen as a major vote of confidence in the country's manufacturing outside the EU. Brexit uncertainty has since prompted consternation in some boardrooms in Tokyo.

Unite Union representatives are due to meet with Nissan bosses on Monday to discuss the situation.

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