Nissan scraps plan to make SUV in UK over Brexit worries

Bloomberg

Nissan Motor Co. abandoned a plan to make the X-Trail sport-utility vehicle at the UK’s biggest auto factory, saying uncertainty over Brexit isn’t helping on future investment.
“We appreciate this will be disappointing for our UK team and partners,” Nissan Europe Chairman Gianluca de Ficchy said in a statement. “While we have taken this decision for business reasons, the continued uncertainty around the UK’s future relationship with the EU is not helping companies like ours to plan for the future.”
Nissan’s move is another setback for the British car industry, which reported a 46 percent drop in investment last year as carmakers delayed decisions on upgrading machinery and factories amid mounting concern about the impact of a hard Brexit. Nissan two years ago agreed to make the SUV in Sunderland after winning government pledges for access to the EU. Sunderland voted 61.3 percent to 38.7 percent to leave the EU.
“It is a massive psycho-logical blow as well as an economic blow,” Liberal-Democrat Party leader Vince Cable said on “Sophy Ridge on Sunday” on Sky News before Nissan confirmed the decision. “I think Brexit is clearly a major factor. It may be one of several but it is certainly a major factor and it’s not just for Nissan, the same calculations are being made throughout the current industry.”

SHADOW CAST
The UK government is warning that the Brexit negotiations are likely to go down to the March 29 deadline, with the threat of a chaotic no-deal split casting a shadow over businesses. Prime Minister Theresa May is expected to return to Brussels in days in a bid to rewrite the most difficult chapter in the withdrawal agreement with the EU.
The X-Trail model was to be made in the UK, as anno-unced in 2016, after Nissan and UK government reached a deal on future investment, which the company said would secure and sustain the factory’s 7,000 jobs.
Greg Clark, the UK business secretary when the deal was struck, later said he had promised the Japanese automaker that the government would seek to maintain tariff-free access to the European Union once the UK has left the bloc.
The deal was struck before formal talks on the withdrawal began.