Nissan Scraps Plans to Build New S.U.V. in Britain

anastasios pallis

LONDON — The automaker Nissan confirmed on Sunday that it had scrapped plans to build its new X-Trail sport utility vehicle in Britain and would produce it solely in Japan, warning that uncertainty over Britain’s departure from the European Union was making it harder to plan for the future.

Nissan had said in 2016 that it would manufacture the new X-Trail at its Sunderland factory in northern Britain, the country’s biggest car plant. That announcement, which came four months after Britain voted to leave the European Union, was seen as a major vote of confidence in the country and in Prime Minister Teresa May, shortly after she took office.

But falling demand for diesel cars in Europe has forced the automaker to invest in other technologies and to look for cost savings. Last year, it cut hundreds of jobs at its Sunderland factory, as sales of diesel vehicles faltered in the wake of revelations of Volkswagen’s scheme to cheat on diesel emissions tests.

“Nissan has increased its investments in new powertrains and technology for its future European vehicles,” Nissan’s Europe chairman, Gianluca de Ficchy, said in a letter to workers at the Sunderland plant. “Therefore, the company has decided to optimize its investments in Europe by consolidating X-Trail production in Kyushu.”

“While we have taken this decision for business reasons, the continued uncertainty around the U.K.’s future relationship with the E.U. is not helping companies like ours to plan for the future,” Mr. de Ficchy said.

Britain’s business minister, Greg Clark, said the announcement was a “blow to the sector and the region.”

Britain is due to leave the European Union on March 29. Lawmakers last month rejected Mrs. May’s Brexit deal, heightening fears of a disorderly no-deal Brexit and of new trade barriers. She said on Sunday she would seek a “pragmatic solution” to the Brexit impasse.

Nissan builds roughly 30 percent of the country’s 1.52 million cars and exports the vast majority to the continent.

The new X-Trail could have created hundreds of jobs.

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

This article is from NYT – go to source

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