Japan’s Koji Tsuruoka tells Lords panel the firm will not necessarily stay in Sunderland if it is unable to make a profit

Theresa May’s “remarkable” intervention to personally reassure Nissan that Britain would remain a competitive market helped secure new investment at the firm’s Sunderland plant, the Japanese ambassador in London has said.

Koji Tsuruoka said, however, that Nissan would not necessarily stay in the north-east of England if it were unable to make a profit. Any tariffs imposed on imported car parts and exported finished models as a result of Brexit could affect car manufacturers’ bottom line very severely, he said.

Appearing before the Lords EU external affairs sub-committee on Wednesday, Tsuruoka said Nissan saw the prime minister’s decision to invite the firm’s boss, Carlos Ghosn, to Downing Street for talks last month as a “strong commitment of goodwill”.

Days after the meeting, Nissan announced it would build new Qashqai and X-trail models at its plant in Washington, Sunderland, which employs 7,000 people directly, with a further 40,000 jobs in the supply chain.

Tsuruoka told peers that Japanese culture instilled a sense of loyalty at Nissan. “They are part of Sunderland, and in Japanese culture when you become part of a town, part of a community, you don’t abruptly break up. You have created a tradition, and it is more than 30 years and they are like family in Sunderland.

“They know what they decided to do will affect in a major way how Sunderland will do, and therefore they are quite well aware of the responsibility that they now have vis-a-vis the people in Sunderland.

“I am also quite happy that Nissan decision was welcomed by the British people. That doesn’t mean they will stay forever. It is all subject to the profitability of the business. It is up to the Japanese government as well as the UK government to make sure that they continue to make cars outside of the UK.”

Tsuruoka said he did not know what promises the government had made to Nissan. “But having had the prime minister deal with the president of Nissan is in itself a remarkable engagement by the UK government. And therefore I interpret this as a strong commitment of goodwill on the part of the host government for Nissan and you might have seen.”

In Sunderland, where 61.3% of residents voted for Britain to leave the EU, many people never thought Nissan would leave, even when Ghosn threatened in late September that the company would pull out if he were unable to extract “compensation” from the government.

Councillor John Kelly, a leave voter whose Washington North ward includes the Nissan plant, told the Guardian: “I really cringed at [Ghosn’s threats to leave]. It was such an open attempt at intimidation. To be honest it didn’t affect us up here, we said: ‘Ain’t going to happen.’ This plant is so efficient, it is a world leader.”

During the hearing in parliament, Tsuruoka reiterated Japan’s wish for the UK to secure tariff-free trade, particularly for its car manufacturers, which rely on EU-wide supply chains. Each Nissan model comprised 20,000 parts, many of which did not come from the UK, he said.

“The combination of this two-way street – no tariffs, no obstruction for the free flow of parts that come in, and also bringing the final product back to, for example, the European continental market. If you have tariffs on both sides it means the company suffers very severely.

“If you put some artificial barriers along the way then by definition it’s going to be costly and inefficient. That is something the car manufacturers here in the UK are quite concerned [about].”



Tsuruoka repeated a call for transitional arrangements to be put in place once a Brexit deal is reached to stop Japanese companies facing a “shock” change in trading conditions.

He also suggested Japan would be able to strike a post-Brexit free trade deal with the UK more easily if it submitted to EU regulations to be set out in the Japan-EU Economic Partnership Agreement (EPA) currently being negotiated.

“Once you have the Brexit negotiation over and you become a separate economic entity that is capable of negotiating, agreeing with another country on the terms of trade, of course we will be willing to engage,” he said.

“For now, we cannot – not because of Japan not liking it, it’s because the system doesn’t allow us to do that.”