A No-Deal Brexit Would Make Nissan’s Current European Business Model Unsustainable

Credit: Nicholas McGinn/The Business Journals

Nissan’s European chairman has warned that a no-deal Brexit could put its operations “in jeopardy.”

If the World Trade Organization rules are enforced after Brexit, a 10% export tariff would threaten the company’s operations.

Speaking at Nissan’s plant in Sunderland, Nissan’s European chairman Gianluca de Ficchy explained his company’s concerns to the BBC. The plant in Sunderland has recently received a massive investment from Nissan and is now set to start manufacturing the newest model of the Juke. The plant already manufactures the Qashqai and electric Leaf models. Chairman de Ficchy explains that it was difficult to push these plans forward amid the uncertainty that Brexit has presented.

The new Juke model is going to be manufactured in the UK and its primary target is the European market. About two-thirds of the components needed to make the car are sourced from the EU and about 70% of manufactured Jukes are expected to be sold in the EU. Apart from the Sunderland plant, which employs 7,000 workers, Nissan has operations in Spain.

Now that a no-deal Brexit is just under three weeks away, Nissan has several concerns regarding its European business. “The only message I can [give] is that if a no-deal will be associated with the application of 10% duties under the WTO rules, that will create an enormous problem for the overall European activities of Nissan Europe. If we will have to sustain 10% export duties on the vehicles that we export from UK to EU, knowing that those vehicles represent 70% of total production, the overall business model won’t be sustainable. It’s not a question of Sunderland, it’s a question of the overall economic sustainability of our business [in Europe],” Mr. de Ficchy told the BBC.

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