Nissan chooses Japan over United Kingdom to build new X-Trail vehicle

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More than two years ago, shortly after the UK voted for Brexit, Carlos Ghosn, then Nissan boss, secured a "letter" from the UK government which convinced Nissan the UK would still be a good place to do business for Nissan post-Brexit. "We recognise that the United Kingdom has a stake, and we are backing your continued success in Sunderland to the hilt". May's government had previously gone out on a limb to safeguard Nissan's investment in the United Kingdom, offering assurances in a private letter. The Sunderland factory has been up and running since 1986 and is predominantly focused on the Qashqai, Leaf and Juke, which will continue.

Britain is due to leave the European Union on March 29.

Nissan, who once viewed Britain as its gateway to Europe, is now citing growing uncertainty over Brexit in its decision to scrap plans to build a new model in the country.

The Sunderland plant, which has been active since 1986, employs nearly 7,000 people, producing around 2,000 cars a day.

"We appreciate this will be disappointing for our United Kingdom team and partners", he added.

The company said planned investment in the next-generation Juke and Qashqai, also announced in 2016, was unaffected.

Speaking in parliament on Monday, Clark called the decision "disappointing".

"But we can not deny the inevitable role that Brexit plays here". Attitudes might be very different if the European Union flag had flown outside the Washington factory - and other sites of regeneration that owed their existence and success to Britain's membership, and to substantial European Union grants and loans over the years. "If we were outside the community, it is very unlikely that Nissan would have given the United Kingdom serious consideration as a base for this substantial investment".

Mr Clark said that when he appeared before the committee in December 2016, there were aspects of his letter to Nissan that were commercially confidential.

"They did agree to build this X-trail in Sunderland, but now they've changed the decision to build it in Japan, given that Japan has a nice new trade deal with the EU".

Progress toward a Brexit agreement has stalled in recent weeks because of deep political divisions in the United Kingdom. Supply chains would be snarled and shipments could be delayed at the border.

Nissan said the decision to build the SUV's in Japan would reduce investment costs in the early stages of the project.

It also said that the government would offer to firm up to £80 million to support the development of skills, research and development, which led to accusations that ministers were doing secretive deal with firms ahead of Brexit.

"Its role in providing high skilled well paid jobs, innovative R&D and investment is why we are determined to build on these strengths to make the United Kingdom a leader in the next generation of autonomous and electric vehicles through the Automotive Sector Deal, as part of our modern Industrial Strategy".