According to Bloomberg, Nissan is set to significantly increase electric vehicle production in the UK, with an additional investment of £2 billion (approximately $2.5 billion) in its Sunderland plant. The announcement on November 24 indicates that Nissan's blueprint for the Sunderland EV36Zero electric vehicle center will encompass manufacturing three electric vehicle models, constructing three super factories, and a total investment of up to £3 billion.
The three electric vehicles to be produced at the Sunderland plant by Nissan will include fully electric versions of the Qashqai and JUKE flagship models, as well as the next-generation LEAF. Additionally, Nissan has stated its intention to establish a new battery factory in Sunderland.
Both vehicle and battery manufacturing at this electric vehicle center will be powered by the EV36Zero microgrid, integrating Nissan's wind and solar farms, with the capability to provide 100% renewable power to Nissan and its nearby suppliers.
Previously, in 2021, Nissan and Envision AESC announced a £1 billion investment to expand electric vehicle and battery manufacturing in Sunderland. With this additional £2 billion investment by Nissan, the total investment reaches £3 billion.
The Sunderland plant currently employs around 6,000 workers, producing Juke, Qashqai internal combustion engine cars, and the compact Leaf EV. Qashqai was the best-selling car in the UK last year and the only domestically manufactured model to hold this title in the past 24 years. The Sunderland plant began production in 1986 and has produced over 11 million vehicles to date.
Building another battery factory signifies that the UK is gaining more of the crucial infrastructure needed to sustain its electric vehicle production. The UK government is providing assistance to this project, and Prime Minister Rishi Sunak has expressed appreciation for these plans, calling it a "vote of confidence" in the UK automotive industry. Nissan's Senior Executive Alan Johnson revealed the UK government's support for the project on November 24 in an interview with BBC Radio 4, although he did not disclose the specific amount.
For Nissan to build more electric vehicles in Sunderland is seen as a symbolic victory for Sunak. Furthermore, Nissan has committed to fully electrifying its European product line by 2030, despite the UK postponing the ban on the sale of petrol and diesel cars to 2035.
"This collaboration will undoubtedly ensure Sunderland becomes the Silicon Valley of electric vehicle innovation and manufacturing in the UK," Sunak stated.
Post-Brexit, the future of the UK, a major automotive manufacturing base, has been shrouded in uncertainty, making Nissan's move a positive development for the country. However, several questions still remain. Since reaching its peak production of 500,000 vehicles in 2016, the Sunderland plant's car output has decreased by about half, and Nissan's announcement did not explicitly state whether the latest plans would secure future employment or increase the factory's production.
Moreover, in the long term, the Sunderland plant must face fierce competition in the electric vehicle sector and navigate the complexities of post-Brexit regulations. Currently, around 70% of cars produced in Sunderland are exported to the EU. Under current arrangements, starting next year, electric vehicles flowing between the UK and the EU, with less than 45% of their parts' value from the region, will be subject to a 10% tariff. Lobbying groups representing European automakers such as Volkswagen and Renault have warned that these tariffs could bring about €4.3 billion (approximately $4.7 billion) in losses to the industry over the next three years. Negotiations on the potential postponement of this regulation are currently underway.
