Nissan boss issues UK investment warning after Brexit vote

Carlos Ghosn says investment on whether to invest in the country including its Sunderland plant that employs 7,000 people has been put on hold

Remain supporters gather outside Parliament the day after the Brexit vote in June (AP)

The head of Renault-Nissan, one of the world's biggest car manufacturers, has warned that a decision on whether to continue investing in the UK is on hold until the Brexit negotiations have produced a result.

Renault-Nissan is the biggest single employer in Sunderland, which was once one of the UK's worst unemployment black spots, and losing the plant would be economically devastating for the region, but Carlos Ghosn, chief executive of Renault-Nissan, said that he was “reasonably confident” it will not come to that.

But like other major companies, Renault-Nissan is now waiting to find out exactly what ‘Brexit’ means and what kind of trading relationship the UK will have with the rest of Europe when negotiations are complete.

Mr Ghosn told the BBC: "I don't think today you can talk about any impact before we see what is the new status of the UK. The question of Sunderland – Sunderland is a plant which is a European plant based in the UK.

"Most of the production out of Sunderland is exported to Europe. So obviously for us the relationship which is going to prevail between the UK and Europe is very important.

“Okay, the UK is out of Europe. Fine. But what's going to be the new status?”

A spokesman for the North East Chamber of Commerce said: "It will be a decision for Nissan to take but what we want to see is action from government during the Brexit negotiations to ensure the North East does not lose out as a result of any new arrangements.

"Nissan is a huge player in the region and makes up a huge part of our exports and we need to see long-term investor confidence in the North East and to be seen as a desirable location for exporters.

"What government can do is help to support business confidence in the region to ensure we are able to invest in skills."

Paul Watson, leader of Sunderland City Council, said it was good to hear that Mr Ghosn was "cautiously optimistic" but added that he feared manufacturing in the North East would not be a priority during Brexit negotiations.

"Nissan is in Sunderland because it wants and needs to be in the European market and the threat to it is the uncertainty until the UK and European Union negotiate trade deals," he said.

"My worry and fear is that automotive manufacturing in the North East of England might not be a priority for the UK Government compared to financial services and the interests of the City of London when negotiations get under way."

When the Nissan plant opened in Sunderland in 1986, it was the first time that a Japanese car manufacturer had moved production to the UK. At that time there were 29,000 registered unemployed in the city of Sunderland. That was more than one in ten of the city's entire population, and around a quarter of the entire workforce.

Today, the Renault-Nissan plant directly employs 6,700 people, and is reckoned to generate another 27,000 jobs in the surrounding area. Unemployment in Sunderland is a third of what it was 30 years ago, with 10,600, or 8.2 per cent, registered unemployed. In 30 years, the plant has turned out more than eight million cars, the majority of which have been shipped across the Channel for sale in other EU states, taking advantage of the single market.

Sunderland’s voters backed Brexit by 82,000 to 52,000 in last month’s referendum.