Business

Nissan is to commit to manufacturing electric versions of two of its bestselling models at its Sunderland plant after months of talks with the government.

Sky News can reveal that the giant Japanese car manufacturer will announce on Friday that it will build the electric Qashqai and Juke at the site – a decision that will help safeguard thousands of jobs there.

Sources said on Wednesday evening that Prime Minister Rishi Sunak and Chancellor Jeremy Hunt had been involved in the discussions with Nissan and were likely to play a role in this week’s announcement.

One added that the investment decision would involve a significant government funding guarantee, although it was unclear whether any taxpayer cash would be provided up front by taxpayers.

Nissan is expected to commit hundreds of millions of pounds and potentially more than £1bn to the project, automotive industry sources said.

The announcement will provide fresh evidence of Nissan’s long-term commitment to Sunderland after a period of uncertainty that the company said had been exacerbated by the 2016 Brexit referendum.

Image:
A car is seen on the production line at the Sunderland plant

In 2019, the company said it would no longer proceed with production of the X-Trail in the North East, deepening the gloom which engulfed the industry at the time.

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It announced three years later that it would shut the area of its vast Sunderland factory dedicated to making cylinder heads for Renault combustion engines.

Nissan’s Sunderland plant employs 6,000 people, comprising the bulk of the company’s British workforce.

It already makes the short-range electric Leaf model at the site.

Those employees now play a central role in what Nissan calls EV36Zero, its flagship manufacturing hub and electric vehicle ecosystem.

The project was launched in 2021 with an initial £1bn investment by Nissan and its industrial partners, bringing together electric vehicles, renewable energy and battery production.

It includes a huge gigafactory being built in partnership with Envision, a Chinese company.

In his autumn statement on Wednesday, Mr Hunt said the government would invest £4.5bn into British manufacturing from 2025.

That investment will be distributed across a range of sectors, including automotive and clean energy.

“Britain is now the eighth-largest manufacturer in the world, recently overtaking France,” Mr Hunt said.

“To build on this success, we are targeting funding to support the sectors where the UK is or could be world-leading.

“Our £4.5bn of funding will leverage many times that from the private sector, and in turn will grow our economy, creating more skilled, higher-paid jobs in new industries that will be built to last.”

It was unclear on Wednesday over what period the government funding guarantee for the new electric models would run, or how many electric Qashqai and Juke vehicles Nissan expects to produce at Sunderland over the next decade.

Nissan and the government declined to comment on Wednesday.

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