Nissan Brexit Bribe Backfires

After Nissan head man Carlos Ghosn fetched up in Downing Street - in a Qashqai, natch - and told Theresa May of his, er, concerns for the future of the company’s Sunderland plant, which makes more than one in four cars built in the UK, he received a number of what have enigmatically been termed “reassurances”, which were sufficiently enticing to have the company later decide to commit to retaining and expanding the plant.

The thought immediately entered with many commentators that some kind of deal had been done, whether through promise of subsidy, or other means. This was not sufficiently deflected by the official Downing Street spokesman telling “There was no special deal for Nissan”, especially as “He declined to comment on whether the industry had been promised lower energy costs”. There are other possibilities.

As the Guardian helpfully explained, “Industry sources said the government could provide subsidies towards training existing staff and hiring new workers”. The Government might also give relief from part of the plant’s business rates, or assist in some way with the construction work involved in expanding the site - helping with any purchase of additional land, for example. And so the guessing game continues.

But Nissan is not the only car manufacturer in the UK: indeed, although it churns out well over 450,000 vehicles annually, it is not the largest, an accolade which is now held by Indian-owned Jaguar Land Rover, with sites in the West Midlands and Merseyside. Other significant players include Toyota at Derby, Honda at Swindon, BMW near Oxford, General Motors on Merseyside, with Ford still building engines in the UK.

And those players have wasted no time in asserting that whatever the not-at-all-special-deal that Nissan didn’t really get, they want the same. The people at Reuters don’t appear to believe the “no deal” line either, hence their headline “May's Nissan deal opens floodgates as rivals seek Brexit reassurance”.

The man from Jaguar Land Rover spelt it out: “We are talking to government at every level and asking for a tariff-free trading environment, access to talent and the same legislative framework we have now … We want a level playing field”. Moreover, “the boss of Airbus UK [said] the agreement showed the aerospace and defence sectors needed to work together”. Which means JLR and Airbus want what Nissan got.

Ford’s VP for the EMEA region, Jim Farley, also fancied a bit of what Nissan didn’t really get, telling “I don't think the government will be picking winners and losers in our industry … I would be very surprised if the UK government treats different companies differently”. But unless Britain remains part of the EU customs union at the very least, those companies asking for reassurances can’t have the trading environment they do at present.

And what the Nissan talks point to is continuing membership of the Single Market. That would be something like we have already, without the rebate, or indeed a say in how the EU develops. We may not be able to afford many more successes like that.