Japanese automaker Nissan Motors recently announced that they would no longer be manufacturing their new X-Trail SUV model in the UK. Instead, the company has decided that they will be making the new model in their factory in Japan to reduce cost. According to a letter that was sent to its workers in the UK, the company is apparently fearful that the entire Brexit issue may hamper their plans for the company's future in the country.
Nissan originally announced in 2016 that it would be making the new model in the UK after it had made an acceptable deal with the government. UK officials apparently assured the company that they would not have any problems despite the ongoing Brexit negotiations. Nissan currently employs around 7,000 people in its factory in the English city of Sunderland. The factory has been actively making Nissan vehicles since 1986.
Aside from its Brexit concerns, Nissan has also stated that its decision was also affected by the country's changing emissions regulations. Automotive manufacturers in the UK with diesel cars that fail to meet the latest emission standards currently face a number of hefty levies. Some countries in Europe, including the UK, have also planned to start banning certain diesel and petrol vehicles from being sold in the coming years. Diesel car sales in the country have been affected by the new regulations, resulting in a 30 percent decrease in overall car sales in 2018.
Other manufacturers, such as Toyota, Jaguar, and Vauxhall, have expressed similar concerns over the past few months. Most of these companies are afraid that the UK's decision to leave the EU may affect their supply chains and ultimately their bottom line.
The country's Business Secretary, Greg Clark, announced in a statement that Nissan's decision to cancel their X-Trail investment in its Sunderland plant is a huge blow to the entire sector. The investment was expected to further expand the site's workforce, which would have greatly benefited the region. Jaguar and Ford have already laid off a number of its workers in the UK. Fortunately, Nissan has assured its workers that no jobs will be lost because of their decision. However, the company will no longer be able to deliver on the hundreds of new jobs that were promised had the X-Trail investment pushed through.
The plant in the UK will still continue to make the current models that it is producing. This includes the production of the Nissan Qashqai, the company's best-selling crossover in Europe.
