More

    Nissan Boosts Electric Car Production in the UK


    Oli SCARFF

    Text size

    Japanese auto giant Nissan announced Friday it would invest up to £2 billion in UK electric car manufacturing, which the government touted as a sign of confidence in the sector.

    Nissan said it will produce electric models of two best-selling cars, Juke and Qashqai, at its facility in Sunderland, northeast England, which is its biggest factory in Europe, building on UK net zero plans to switch away from dirty fossil-fuel vehicles.

    The carmaker will plough £1.12 billion ($1.4 billion) into its UK operations and wider supply chain for research and development and manufacturing of the two new models, it added in a statement.

    That will also spark further investment in infrastructure projects and the supply chain, including another electric car battery factory, bringing total investment to as much as £2 billion ($2.5 billion).

    Nissan’s investment will support its UK workforce of 7,000 employees — and 30,000 jobs in the nation’s broader supply chain.

    “Exciting, electric vehicles are at the heart of our plans to achieve carbon neutrality,” said Nissan President and CEO Makoto Uchida.

    “With electric versions of our core European models on the way, we are accelerating towards a new era for Nissan, for industry and for our customers.”

    Uchida declared in September that there was “no going back” on the group’s electrification plans as it aims for 98 percent of European sales to be electric vehicles by 2027.

    The news comes as Britain looks to take a leading role in the production of electric cars as companies and governments shift away from high-polluting automobiles.

    The UK government confirmed Friday that it has awarded £15 million of funding towards a collaborative R&D project for zero-emission vehicles led by Nissan.

    “Nissan’s investment is a massive vote of confidence in the UK’s automotive industry, which already contributes a massive £71 billion a year to our economy,” said British Prime Minister Rishi Sunak, who will attend a formal announcement at the site later on Friday.

    “This venture will no doubt secure Sunderland’s future as the UK’s Silicon Valley for electric vehicle innovation and manufacturing.

    “Making the UK the best place to do business is at the heart of our economic plan.”

    Finance minister Jeremy Hunt pledged Wednesday in his budget update to invest £4.5 billion in strategic sectors including the auto industry.

    However, earlier this year Sunak softened policies aimed at reaching net zero carbon emissions by 2050, delaying a ban on the sale of petrol and diesel cars by five years to 2035.

    That still means however that the country’s largely foreign-owned car manufacturing sector must switch to producing fully-electric vehicles.

    Nissan had previously warned that a no-deal Brexit would threaten the Sunderland site, but committed to its future after the government agreed a trade deal.

    Yet the nation’s car industry has warned that automakers will soon face a damaging 10-percent hike in customs duties on electric cars crossing the Channel.

    Britain left the European Union in 2021 after clinching a last-gasp free trade agreement which removed tariffs on cars.

    But under the deal, from January 1, 2024, at least 45 percent of the value of car parts must originate from Britain or the European Union to be exempt from customs duties.

    That hits electric carmakers because their batteries often originate from China, despite UK efforts to establish production.

    Japanese Auto Giant Nissan Invests £2 Billion in UK Electric Car Manufacturing

    Japanese auto giant Nissan announced on Friday its plan to invest up to £2 billion in UK electric car manufacturing, which the government considers a significant show of confidence in the sector.

    Nissan, the largest carmaker in Japan, intends to produce electric models of its two top-selling cars, Juke and Qashqai, at its factory in Sunderland, northeast England. This facility is Nissan’s biggest factory in Europe and aligns with the UK’s net-zero plans to transition away from fossil-fuel vehicles.

    The £2 billion investment comprises £1.12 billion towards research, development, and manufacturing of the two new electric car models. The remaining funds will be utilized for infrastructure projects and the supply chain, including the establishment of another electric car battery factory. This investment is expected to support 7,000 employees at Nissan’s UK operations and create an additional 30,000 jobs throughout the nation’s broader supply chain.

    Nissan’s President and CEO, Makoto Uchida, emphasized the company’s commitment to electric vehicles, stating that they are crucial for achieving carbon neutrality. Uchida also expressed Nissan’s determination to enter a new era in collaboration with their customers.

    In addition to Nissan’s investment, the UK government has granted £15 million of funding for a collaborative research and development project focused on zero-emission vehicles, led by Nissan. The government views this investment as a vote of confidence in the UK’s automotive industry, which currently contributes £71 billion annually to the economy.

    British Prime Minister Rishi Sunak praised Nissan’s investment, emphasizing its positive implications for Sunderland’s future as a center for innovation and manufacturing in the electric vehicle industry. Sunak also reaffirmed the government’s commitment to making the UK an attractive business destination.

    The UK government has demonstrated support for the auto industry by allocating £4.5 billion in strategic sector investments, including the electric car manufacturing sector. However, there has been a delay in implementing policies aimed at achieving net zero carbon emissions by 2050. The ban on selling petrol and diesel cars was pushed back by five years to 2035. Nonetheless, this adjustment underscores the necessity for the predominantly foreign-owned car manufacturing sector to transition to producing fully-electric vehicles.

    Nissan had previously expressed concerns about a potential no-deal Brexit jeopardizing the Sunderland site. However, following the agreement of a trade deal between the UK and the EU, Nissan has affirmed its commitment to the site’s future.

    Despite these positive developments, the UK’s car industry has cautioned that automakers could soon face a 10% increase in customs duties on electric cars crossing the English Channel. This potential hurdle arises from the requirement, under the free trade agreement, that at least 45% of the car parts’ value must originate from the UK or the EU to be exempt from customs duties. This condition presents a challenge for electric car manufacturers whose batteries often originate from China, despite UK efforts to establish battery production domestically.

    With Nissan’s substantial investment and the UK government’s support, the UK aims to secure a leading role in the production of electric vehicles. As the world shifts towards sustainable transportation, this investment signals a positive step towards a greener, more environmentally friendly future.

    Latest articles

    Related articles