Nissan Warns Dire Result of “Hard” Brexit

Nissan Motor Co. will revisit its commitment to build Qashqai crossover vehicles in England if the U.K. exits the European Union at the end of this month with no replacement trade deal.

Nissan’s pledge three years ago to make the next-generation Qashqai at its Sunderland plant assumes a “soft” Brexit, sources tell the Financial Times. At the time, then-Chairman Carlos Ghosn said he received assurances from the British government that the factory would be shielded from disruptions and higher trade tariffs resulting from Brexit.

Nissan said in February that uncertainty about Brexit prompted it to scrap plans to produce the next-generation X-Trail SUV in England. The current Qashqai (pictured) accounts for two-third of the plant’s 440,000-unit annual output. The facility also makes the Juke small crossover and Leaf electric sedan.

FT’s sources warn that a hard Brexit could doom the factory because Nissan, whose global sales have slumped, has launched a worldwide cost-cutting and consolidation review. Japan has a trade deal with the EU that enables it to ship vehicles to Europe from Japan duty-free.