Nissan sparks Brexit shockwaves through U.K. auto sector

Greg Clark has faced criticism over Nissan

The up to £80 million of support on skills, research and development and innovation was contingent on the new Qashqai and X-Trail models being built in Britain, Clark wrote.

The Department for International Trade said its priority was to ensure there was no disruption to UK-Japanese trade after Brexit, but that it would then seek to go further than the deal signed by Brussels. At the time, the government would not reveal what it had said in a letter to Nissan, but denied that financial incentives had been offered.

"It will be a critical priority of our negotiation to support United Kingdom vehicle manufacturers and ensure that their ability to export to and from the European Union is not adversely affected by the U.K.'s future relationship with the European Union", he said.

Britain on Monday will seek to reassure foreign investors anxious about Britain leaving the European Union after Japanese automaker Nissan said it was scrapping a major planned investment less than two months before Brexit.

Nissan is moving production of the X-Trail from its plant in Sunderland, England, to Japan due to Brexit issues. The secretary told parliament Monday that as a result an offer of grants totaling 61 million pounds was made on June 21, 2018, and of them, 2.6 million pounds has already been paid.

"While I'm pleased the decision taken in 2016 to build the Qashqai and secure the Sunderland plant is unchanged, it's deeply disappointing to me and to the workforce that the extra jobs that would have come from the X-Trail will no longer be available".

Automotive manufacturers in the United Kingdom with diesel cars that fail to meet the latest emission standards now face a number of hefty levies.

The department revealed the package of support it offered Nissan after the firm announced yesterday that it would reverse its pledge to build the vehicle at the plant.

"The continued uncertainty around the UK's future relationship with the EU is not helping companies like ours to plan for the future", Nissan's European chairman Gianluca de Ficchy said. Brexit uncertainty has since prompted consternation in some boardrooms in Tokyo.

Following the announcement, Clark said it would be "a blow to the (country's automotive) sector and the region".

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

The so-called backstop is meant to ensure there is no return to a hard border with Ireland, but Brexit supporters fear it will keep Britain tied to the EU's customs rules.

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