Nissan is giving the British government a boost as it attempts to resuscitate the nation’s faltering economy by investing $1.4 billion to modernize its factory in north-east England so that it can produce electrified versions of its two best-selling cars.
At its Sunderland factory, the Japanese carmaker employs 6,000 people to produce the smaller Juke crossover and the gasoline or gas-hybrid Qashqai.
According to Nissan Motor Company, it will directly invest up to 1.12 billion pounds ($1.4 billion) in the production of the two models’ electric replacements. According to a separate press release from the government, the funds would also allow for “wider investment in infrastructure projects and the supply chain, including a new gigafactory” for EV batteries at the location.
Prime Minister Rishi Sunak stated, “Nissan’s investment is a massive vote of confidence in the U.K.’s automotive industry,” which boosts the country’s GDP by 71 billion pounds annually.
In addition to meeting employees and taking a tour of the facility, Sunak visited the factory for the announcement, where he posed for pictures with Treasury Secretary Jeremy Hunt in front of a blue Qashqai on the manufacturing line. Ahead of a national election scheduled for next year, Hunt announced the day before tax cuts and other budget goals. This came at a time when the UK’s economy is struggling and consumers are feeling the pinch of persistently high inflation.
This year, the Qashqai is the second most popular car in the UK, and the Juke is ranked seventh. Nissan recently announced that it will produce the upcoming model of its venerable Leaf electric vehicle in-house.
The firm stated in 2021, that it intended to construct an electric car at the plant in addition to batteries supplied by neighboring supplier AESC, which is owned by China’s Envision. With Friday’s announcement, AESC now has three gigafactories in Sunderland. There were already two before.
Nissan President and CEO Makoto Uchida stated in a statement that EVs are “at the heart of our plans to achieve carbon neutrality.” “We are moving closer to a new era for Nissan, the industry, and our customers with the arrival of electric versions of our core European models.”
By 2030, Nissan wants all of its passenger cars in Europe to be electric.
“We are bringing that vision to life with today’s announcement,” Uchida declared at the plant, where production had been briefly halted for the event.
Nissan’s Sunderland plant’s future had been uncertain both before and after Britain voted to exit the European Union in 2016. Brexit opponents claimed that since businesses like Nissan would have to pay tariffs on exports to the EU, Britain’s economy would suffer if it left the bloc without a trade agreement.
The car sector is preparing for 10% trade duties that will go into force in January following Brexit. By punishing manufacturers in their individual markets for getting insufficient amounts of their components from the EU or Britain, they threaten to increase the price of new electric vehicles.
Because Europe is lagging behind Asia in battery production, many EV manufacturers will find it difficult to meet the need. On the other hand, Nissan is the only automaker in the UK with a close dedicated battery facility.
Nissan is now producing electric vehicles in the United Kingdom alongside other automakers, despite Sunak delaying the deadline to stop selling new gas and diesel vehicles by five years, until 2035.
In order to begin producing electric vehicles by 2026, BMW said earlier this year that it is investing 600 million pounds into its Mini factory in Oxford, England.
The 4 billion-pound EV battery factory being built in the United Kingdom by India’s Tata Sons, the company that owns Jaguar Land Rover is anticipated to manufacture roughly 40 gigawatt hours of battery cells annually, which is sufficient to supply half of the country’s needs for batteries for electric vehicles.
North-west England will see the production of electric vehicles and vans thanks to a 100 million pound investment by Stellantis, the parent company of British manufacturer Vauxhall.
