Nissan's UK business tough to sustain without Brexit deal, COO says

TOKYO -- Any final exit by Britain from the European Union that worsens business conditions through increased tariffs would threaten the sustainability of Nissan's UK operations, the automaker's chief operating officer, Ashwani Gupta, said.

Nissan, which employs 7,000 people at Britain's biggest auto plant in Sunderland, north-eastern England, in June called for an "orderly balanced Brexit."

Its latest warning, however, comes as the EU cautions Britain it has less than 10 days left to secure a deal that will govern trade from next year.

"If it happens without any sustainable business case obviously it is not a question of Sunderland or not Sunderland, obviously our UK business will not be sustainable, that's it," Gupta told Reuters on Wednesday.

Almost 11 months after it formally quit the union, Britain and the EU have still not worked out a deal that will affect nearly $1 trillion in annual trade following a transition period that has kept custom rules in place.

Prime Minister Boris Johnson has warned his top ministers that a trade agreement is far from certain, but that Britain would thrive with, or without, a deal.

Nissan in March said it would push ahead with an expansion in Sunderland worth 52 million pounds ($69 million) to build its new Qashqai SUV.

The introduction of the delayed third-generation Qashqai, will now happen in the spring, ahead of its sales launch later in 2021, Nissan has said.

When it announced the plan to build the new SUV in 2016, Nissan, which builds it Leaf electric cars at the plant, said Britain had reassured it Brexit would not affect its competitiveness.

But tariffs resulting from a no-deal Brexit would raise costs for Nissan, while any delay in parts supply from overseas due to new customs checks could slow production.

Gupta said Nissan was not seeking compensation from Britain for costs incurred from any no-deal Brexit, contradicting press reports that it and Toyota would do so.

"We are absolutely not thinking that and we are not discussing it," he said.

On a separate plan announced by Johnson to move up a UK ban on new gasoline and diesel cars and vans to 2030 from 2035, the Nissan executive said his company was ready to respond.

"That is not only the UK's transition plan, every country is talking about electrification. We are ready."