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Nissan chairman warns against effects of no-deal Brexit

Gianluca de Ficchy said the firm’s business model could become unsustainable.

Nissan manufactures three models at its Sunderland plant (Owen Humphreys/PA)
Nissan manufactures three models at its Sunderland plant (Owen Humphreys/PA)

By Tom Wilkinson, PA

A no-deal Brexit which led to 10% tariffs on exports would make Nissan’s European business model unsustainable, its chairman has warned.

Speaking at the UK’s biggest car plant in Sunderland, where production is due to start on the new model of the Juke, Gianluca de Ficchy said the business was prepared for Brexit scenarios but could not plan long term.

The Wearside plant has built 10 million “high quality” vehicles in its history and the Nissan Europe chairman praised its workforce.

He said a decision to stop night shifts was not linked to Brexit, but was due to the need to optimise production of the three models it builds – the popular Qashqai, the Leaf electric vehicle and the new Juke.

If a no-deal scenario means the sudden application of WTO tariffs, we know in that case our business model won't be sustainable in the future Gianluca de Ficchy

Two-thirds of the components for the Juke come from the EU and 70% of production was aimed at the continent.

He said: “It is important to have some clear discussions about the future and about the situation in which we have to operate, which we have with Brexit.

“There has been many speculations about the current uncertainty. I wish to clarify the Nissan position about that.

“We have been working together in Europe to define all the risks associated with Brexit coming in and we think we are all really well prepared.

“I think from an operational point of view we have worked in order to prepare for all the different scenarios.”

But Nissan was unable to make plans for the future due to uncertainty about where models will be built.

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Workers on the production line at Nissan’s Sunderland factory (Owen Humphreys/PA)

Mr de Ficchy said there was uncertainty over whether there would be a deal, or no-deal, and what no-deal would represent.

He said: “If a no-deal scenario means the sudden application of WTO tariffs, we know in that case our business model won’t be sustainable in the future.

“Our industry works with lower margins and if we are in a situation in which tomorrow we have to apply 10% export duties to 70% of our production, the entire business model for Nissan Europe will be in jeopardy.

“That’s the reason why we continue to work with all scenarios.”

Mr de Ficchy said there may be some off-setting of tariffs on imported components and exported cars, but there were too many variables for the business to plan.

But he said the quality of the work done on Sunderland since it started production in 1986 meant the business still planned to manufacture there, with £100 million invested in Juke production.

He said: “We know the workforce is concerned about that situation (Brexit) – we are also concerned.

“That’s the reason we are here – to express our concerns.”

He said he had no specific message to the prime minister but that the business required a clear understanding of the Brexit decision.

Nissan employs more than 6,000 people directly in its Sunderland plant – the biggest in the UK – and supports around 35,000 UK jobs in total.

PA

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