Nissan sends Brexit shockwaves through UK auto sector
Nissan's decision to axe planned production of the X-Trail SUV in the Brexit-backing city of Sunderland is a heavy blow to the British auto sector, which repeatedly warned against quitting the EU.
The Japanese carmaker revealed Sunday that the crossover vehicle would no longer be manufactured at its vast plant in Sunderland, northeastern England, despite Brexit assurances from the government.
Nissan has become the latest corporate big-hitter to slash investment in the face of heightened economic uncertainty and a potential no-deal Brexit.
"Brexit uncertainty has decimated investment in the UK auto industry and until that position is clarified, manufacturers are struggling to find a risk-free case for investing further here," Cardiff University professor Peter Wells told AFP.
"Clearly there is a feeling that the short-term to medium-term investment opportunities here are not what they were -- and they are certainly higher risk.
"And I think there are real concerns over access to European markets and access to markets where the European Union has established agreements."
The sprawling facility, producing cars destined for the European continent, is also seeing weak demand for high-polluting diesel cars -- which face tighter regulation worldwide.
"The ongoing backlash against diesel... has affected not just Nissan but other companies here, and that's exacerbated the other problems faced by the industry as a whole," Wells added.
In Britain alone, new car sales slid in 2018 on weak demand for diesel vehicles, as consumers continued to ditch diesel cars for automobiles seen as more environmentally friendly.
Clock ticks to Brexit
Nissan has decided to move assembly of X-Trail cars to its global production hub on the island of Kyushu in southern Japan, reversing a decision made in October 2016.
Shockwaves quickly spread to London, where Prime Minister Theresa May faces an uphill battle to agree a Brexit deal with Brussels as the clock ticks down to the planned March 29 departure date.
Sunderland, which has a population of 300,000, voted in favour of leaving the European Union in the June 2016 referendum.
Business Secretary Greg Clark told a parliamentary hearing on Nissan's decision that company executives told him of "the need for us to come together and to resolve the question of our future trading relationship with the EU".
"I believe their advice should be listened to so the automotive industry… can seize the opportunities for Britain to be a world leader."