One of the biggest fears before June’s EU Referendum was what Britain’s self-imposed departure from the European Union would mean for its booming car manufacturing industry.
2015 marked a ten-year high with 1.58 million new vehicles built in the UK and almost four in five of those heading overseas.
Britain’s car production industry supports thousands of jobs and is vital to the nation’s growth, and the support is mutual; some of the world’s best-known car makers have factories in the UK, from Aston Martin in Gaydon and Bentley in Crewe to Jaguar Land Rover in Solihull, Mini in Oxford and Toyota in Derbyshire.
Nissan is one of the bigger names too. Its Sunderland plant employs a workforce of around 6,700, producing some of the brand’s most popular models, namely the mega-selling Qashqai and the smaller Juke as well as its all-electric Leaf amongst others.
So people took notice when Nissan boss Carlos Ghosn fired warning shots that the Japanese car manufacturer could consider closing its Sunderland factory if the UK left the EU in the lead-up to the vote, fearing production could be shared out amongst one of the nine plants it shares with Renault in France when the Leave vote came through.
Nissan’s continued presence in the UK remained uncertain until late October when the brand confirmed that the next generation Qashqai would take place at the Tyne-and-Wear plant, confirming the plant’s lifespan well into the next decade and securing almost 7,000 jobs. The addition of the X-Trail to Sunderland’s roster was an unexpected surprise too.
The decision to stay came after prime minister Theresa May intervened to personally reassure Nissan that she would be able to secure tariff-free access to European markets.
Even Colin Lawther, Nissan’s European senior vice president for manufacturing, purchasing, and supply chain management, admits it’s something of a leap of faith.
“It comes down to trust at the end of the day,” he told the Guardian. “We are confident the government is taking sufficient measures to make sure the whole of the automotive industry will be competitive at the end of the process.”
He added that there was no financial package “outside the normal, in the public domain request, for grant support”.
But one month has passed and we’re none the wiser what those reassurances are. Even the Japanese Ambassador to the UK Koji Tsuruoka says he doesn’t know. It’s entirely possible to foresee that if Mrs May falls short on her promise that any eventual tariffs would be covered by the taxpayer.
Since the Referendum, one fairly major carmaker – MG – has pulled out of the UK after the cost of assembly at its Longbridge plant was aggravated by the weakened pound in the wake of June’s Brexit vote.
This begs the question ‘can the government really go round making promises to every carmaker to convince them to stay?’.
They probably won’t need to; many carmakers are happy to keep production in the UK, confident that building cars here will remain cost-effective. Read our separate feature on how different carmakers have reacted since the Brexit vote.
So keep calm and carry on? We’ll have to wait and see…
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