Nissan informed MPs that the UK car market needs the government to spend at least ₤ 100 million ($ 123.6 million) to bring in car part producers to Britain or risk a “house of cards” collapse in the sector post-Brexit.
Colin Lawther, Nissan’s head of European production, informed MPs on the International Trade committee that the UK car market was making a “strong” demand for supply chain investment of between ₤ 100 million and ₤ 140 million ($172.16 million).
Lawther stated Nissan sources 85% of its car parts in the UK from beyond Britain and if more were developed in the UK then Nissan alone would invest ₤ 2 billion more in the country.
Along with providing the incentive of more inward investment, Lawther also cautioned MPs that a failure to invest could be devastating for the sector. He told MPs as per the Financial Times: “This is important. If we don’t really invest in the supply base it will be a house of cards impact. Nissan will not prosper in the future, with or without Brexit, unless the government does something to assist us in the supply chain.”
The crucial issue is tariffs. If the UK failed to agree a favorable trading handle Europe rapidly, then car manufacturers will need to swallow large boosts in import expenses for vehicle parts. Lawther approximated it could cost Nissan alone about ₤ 600 million ($737.82 million), as per FT, and the Society of Motor Manufacturers and Traders (SMMT) approximated in 2016 the cost to the whole industry could be as high as ₤ 4.5 billion ($5.53 billion).
