Nissan's £1bn UK Electric Car Investment

author: FutureCar Staff    

Japanese auto giant Nissan is set to announce tomorrow that it will invest over £1 billion to build electric models of its popular Qashqai and Juke cars in Sunderland, northeastern England, according to the Financial Times. The decision to produce electric versions of these vehicles has been supported by financial assistance from the UK government, potentially amounting to hundreds of millions of pounds. This move will not only secure the future of 6,000 jobs at Nissan's largest European facility but also benefit from the presence of a nearby electric battery plant.

Prime Minister Rishi Sunak is expected to attend the announcement at the Sunderland factory, where Nissan CEO Makoto Uchida will make the announcement. However, a Nissan spokesperson declined to comment on the matter. The UK government has recently pledged to invest £4.5 billion in strategic sectors, including the auto industry, highlighting the country's commitment to becoming a leader in electric car production.

Despite this commitment, the government recently delayed the ban on the sale of petrol and diesel cars from 2030 to 2035. Nevertheless, the shift towards fully-electric vehicles remains a priority, and Nissan's decision to produce electric models in Sunderland aligns with this goal. Previously, Nissan had expressed concerns about the future of the Sunderland site in the event of a no-deal Brexit, but those concerns were alleviated after a trade deal was agreed upon.

However, the UK's car industry organization warned last month that automakers could face a 10% increase in customs duties on electric cars crossing the Channel. Although the UK left the European Union with a free trade agreement that removed tariffs on cars, starting from January 1, 2024, at least 45% of the value of vehicle parts must originate from the UK or the EU to be exempt from customs duties. This requirement poses a challenge as many electric car batteries currently come from China, despite efforts to establish domestic production.

In conclusion, Nissan's commitment to building electric models of its Qashqai and Juke cars in Sunderland represents a significant investment in the UK's automotive industry. This decision not only secures thousands of jobs but also aligns with the country's goal of transitioning to fully-electric vehicles. However, challenges remain, particularly regarding customs duties and the sourcing of electric car batteries. Nonetheless, the future of electric car production in the UK looks promising.

FutureCar Staff