Nissan Motor wants the British government to assist it source more components in Britain to make sure the automaker adheres to “rules of origin” if the country leaves the European Union’s customs union.
Almost 60 percent of the parts in an average British-assembled vehicle are made abroad and some elements travel to and from the continent numerous times in the production procedure, which is enabled by Britain’s EU membership.
Prime Minister Theresa May states she wants a Brexit deal which will allow Nissan and other automakers to grow in Britain, and in 2016 the Japanese automaker said it had received assurances allowing it to increase production at its plant located in Sunderland, northeast England.
However Colin Lawther, Nissan’s senior vice president in Europe, informed British lawmakers on Tuesday that leaving the EU would indicate the business would need to increase the level of sterling material in its automobiles to comply with regulations used to identify where a product has come from in order to gain an EU tariff preference.
“Now that is our job to do that, but when you look at the supply base not all of it is in place and that is where we are asking the government to help us,” he informed the legislators.
Numerous international trade deals need around 50 to 55 percent local content, as per automobile market body the Society of Motor Manufacturers and Traders.
This indicates many British models could not qualify and increasing the number of domestic providers would not be quick.
In October, Nissan stated it would proceed with plans to construct the next X-Trail and Qashqai SUVs at its Sunderland plant, however provided no information on the type of guarantees it had received that the site’s export competitiveness would not be damaged.
It has stated it will re-examine the group’s investment method once the terms of Brexit became clear.
Lawther stated he anticipated the final trading environment agreed by the government would not be to the detriment of the business, although it would require “a whole package of solutions” for this, perhaps consisting lower corporation tax.