Nissan to significantly increase electric vehicle production in the UK with additional £2 billion investment in Sunderland plant. The announcement on November 24th reveals Nissan’s blueprint for the Sunderland EV36Zero electric vehicle hub, which will include manufacturing three electric vehicles, building three super factories, and a total investment of up to £3 billion.
Image source: Nissan Nissan to produce three electric cars at Sunderland plant, including all-electric versions of Qashqai and JUKE, as well as the next-generation LEAF. Additionally, Nissan will establish a new battery factory in Sunderland. Vehicles and battery manufacturing at the electric car hub will be powered by the EV36Zero microgrid, which will integrate Nissan’s wind and solar farms and have the ability to provide 100% renewable electricity 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. This new investment of £2 billion brings the total investment to £3 billion. The Sunderland plant currently employs around 6,000 workers and has been producing Juke, Qashqai, and compact Leaf EV. Qashqai was the best-selling car in the UK last year and the only domestically manufactured model to hold that title in 24 years. The Sunderland plant began production in 1986 and has produced over 11 million vehicles to date. Building another battery factory means the UK is gaining more of the infrastructure it urgently needs to sustain its electric vehicle production. The UK government is providing assistance to this project, and Prime Minister Rishi Sunak has expressed appreciation for the plans, calling it a “vote of confidence” in the UK automotive industry. Nissan manufacturing executive Alan Johnson also revealed the government’s support for the project on BBC 4 radio on November 24, but he refused to disclose the specific amount. Nissan’s commitment to build more electric cars in Sunderland is seen as a symbolic victory for Sunak. The company has promised to fully electrify its European product line by 2030, despite the UK delaying the ban on sales of petrol and diesel cars until 2035. “This partnership will undoubtedly ensure that Sunderland becomes the Silicon Valley of electric car innovation and manufacturing in the UK,” Sunak said. Following Brexit, the future of the UK as a major car manufacturing base has been uncertain, and Nissan’s move is good news for the country. However, there are still several issues. Since reaching a peak production of 500,000 cars in 2016, the Sunderland plant’s output has dropped by about half, and Nissan’s announcement did not clearly state whether the new plans would ensure future employment or increase the factory’s production. Furthermore, in the long run, the Sunderland plant must face fierce competition in the electric car sector and the complex rules after Brexit. Currently, about 70% of the cars produced in Sunderland are exported to the EU. Under the current arrangement, starting next year, electric cars flowing between the UK and the EU will be subject to a 10% tariff if the value of the parts from the region is less than 45%. Lobbying groups representing European car manufacturers such as Volkswagen and Renault have warned that these tariffs could result in a €4.3 billion loss to the industry in the next three years. Negotiations regarding a possible delay of this regulation are currently underway. Moreover, Chinese electric car manufacturers such as BYD, Nio, Xpeng, and Great Wall are expanding in Europe, introducing affordable electric cars, posing a threat to local established companies. Furthermore, considering the cost of living crisis and the rapid development of technology, the demand for electric cars may decrease.