Tariffs warning as Nissan boss calls for Brexit clarity
NO-DEAL WOULD MAKE VEHICLES UNAFFORDABLE, SAYS CHAIRMAN
NISSAN’S European chairman has demanded Brexit clarity from the Government after sounding a warning that export tariffs would put the car giant’s European business model in jeopardy.
Gianluca de Ficchy said the Sunderland plant has made preparations for a raft of Brexit scenarios – but said lack of a clear vision for a deal or no deal means the firm cannot plan long term.
He praised the firm’s 6,000-strong workforce, describing them as Nissan’s best asset, while he was in the region for the launch of the new model Juke yesterday, which starts production on Monday.
His arrival at the plant, which supports a further 24,000 jobs in its UK supply chain, came the day after it was revealed night shifts will be stopped at the Wearside plant.
He said the decision was not linked to Brexit, but was due to the need to optimise production of the three models it builds – the popular Qashqai, the Leaf electric vehicle and the new Juke.
Two-thirds of the components for the Juke come from the EU, from 160 suppliers in 14 countries, and 70% of production is also aimed at the Continent.
In the event of a no-deal Brexit, and should WTO tarriffs of 10% suddenly be applied to the firm’s exports, Mr de Ficchy said the extra duty and “significant increase” would make the vehicles unaffordable.
He said: “I know the workforce is concerned and we are concerned. That is why we are here to express our concern and our willingness to find a solution for the future.
“We have a significant number of people, fully dedicated, highly-skilled, enthusiastic and this is the main asset we have that we want to preserve. It’s important to have some clear discussion about the future and the situation in which we have to operate.
“There has been many speculations and many discussions about the current uncertainty and current situation related to Brexit and I really wish to clarify the Nissan position.
“First, all over last year we have been working together in Europe to define all the risks associated with Brexit coming in. We think we are really well prepared, from a logistics point of view, from an operational point of view, for all different scenarios.
“Today, as a business, we don’t have a clear understanding of what the evolution of Brexit will be. We don’t know what deal we will have at the moment. We don’t know what a no-deal will represent.
“If a no-deal scenario means a sudden application of WTO tariffs our business model will not be sustainable for the future. That’s why my message is what we need is clarity, and second, we want as much as possible to avoid a sudden application of WTO tariffs.”
When pushed on whether one of the scenarios might involve migrating work to another plant, and eventual closure of the plant, he said that was not a decision that can be made immediately, and said the firm remained committed to the North East.
He said: “If you have 160 suppliers bringing products in and have, in addition to the 6,000 employees working here, 24,000 additional suppliers working in the UK, you cannot envisage from one day to the other to move something somewhere else.”
Bridget Phillipson, MP for Houghton and Sunderland South, said the last 24 hours had underlined the seriousness of the situation for Nissan.
She said: “First came the news that night shifts would go. While thankfully there are no job losses, some 3,000 people will in effect be receiving a pay cut.
“Then came the announcement that the new Juke will be rolling off the production lines from Monday. This should be a moment of pride and celebration for our region.
“But today also saw the stark warning from Nissan’s Europe chairman Gianluca de Ficchy. He was clear that Nissan created a plant in Sunderland ‘to serve European markets,’ that no-deal would put their entire business model ‘in jeopardy’ and that it ‘won’t be sustainable.’
“Johnson said no-deal won’t be ‘anything like as bad as you say’ in reference to Nissan – the company disagrees. This isn’t getting Brexit done. It is getting done over by Brexit.”