Nissan will build batteries for its EVs in UK
The localised battery production will mean that the Sunderland factory will not face closure post-Brexit.
Several weeks ago, the Nissan factory in Sunderland faced a dark future due to the possibility of a no-deal Brexit. Now that everything has been sorted and news programmes are finally finding new topics to talk about, Nissan has set about preparing for the post-Brexit era by announcing that EV batteries will be built in Britain.
This new localisation policy will also mean that the company will no longer produce the 62kWh batteries for the top-of-the-range Leaf models in the US and then export them into UK.
Under the new trade deal, at least 55% of a vehicle's material value must come from the UK or EU to avoid tariffs. This means that localising battery production will allow Nissan to avoid tariffs on the 70% of Leaf models that are going to be exported.
In an interview with BBC, COO of Nissan Ashwani Gupta stated "The Brexit deal is positive for Nissan. Being the largest auto maker in the UK, we are taking this opportunity to redefine auto-making in the UK."
Secretary of State for Business Kwasi Kwarteng also welcomed the announcement by stating that the decision represents a genuine belief in Britain and a huge vote of confidence in our economy thanks to the certainty our trade deal with the EU delivers." He also stated that the decision "positions the company to capitalise on the wealth of benefits that will flow from electric vehicle production."
It's also possible that thanks to the Brexit deal, Nissan will reverse its 2019 decision to scrap production of the X-Trail. Nevertheless, it has not yet been confirmed whether the move will create more jobs at the Sunderland factory, where more than 6000 people are currently employed.
In my opinion, this move will also lead to more competition within the EV market; the Leaf is one of the best-selling EVs in Britain, and now it will have to compete with several other brands such as Vauxhall, Mini and Honda that have made small and cheap electric cars, not to mention other brands such as Jaguar and Tesla.