Nissan has called on the government to provide investment to help rebuild the UK’s car parts business so it can replace components that come from overseas after the country leaves the EU.

A Commons select committee was told by a senior Nissan executive that the company was forced to source up to 85% of its components from Japan, China and Europe, as the necessary car parts were no longer produced in the UK. If these parts were made in the UK instead, Nissan would spend up to £2bn a year with British suppliers.

Colin Lawther, the company’s senior vice-president of manufacturing supply chain, told MPs on Tuesday that Nissan’s Sunderland plant consumes 5m parts a day for a production line that produces two cars every minute.

Lawther said the automotive industry has made a “strong request” for government support for £100m to £140m of investment for a supply development fund to “repower the supply base” and build an indigenous, high-tech car components sector in the UK.

“From Nissan alone, we would like to spend something like £2bn or more per year on parts from the UK, assembled in the UK,” he said.

Nissan is looking to increase content from British suppliers because of the threat of tariffs on components, which can travel several times between the UK and other EU countries during the construction of a vehicle.

There are about 5,000 components in the average car and it has been reported that in some cases they cross the Channel as many as 30 times.

Lawther said Nissan was looking for a bundle of measures in Brexit negotiations and had made “a strong request” to the government to ensure Britain stayed in the customs union.

A World Trade Organisation alternative would be a financial “disaster” with a 10% tariff on exports costing the company up to £500m a year, he added.

Customs checks on freight in and out of the plant would also be a problem, Lawther said, with every minute factored into the business costs.

“Take Sunderland. We hold about half a day’s stock inside the plant itself, and that’s continuously replenished. Every day we use about 5m parts; 5m have to come into the plant, they have to get fitted to the right car and we build two cars every minute,” Lawther said.

“We talk about minutes; we’re talking two, three, four, six minutes’ downtime a day interruption is a disaster.”

The overseas content of Nissan cars would have to be reduced by about half if the cars were to be deemed British under WTO rules of origin.

Much of the high-tech parts including parking cameras, electronic controls and brake control units come from Japan, with others coming from China and the eurozone.

Lawther said Nissan was already talking to Sunderland city council and to the Highways Agency about taking land and investment to provide “the canvas for suppliers to come”.

A local plant would be high-tech, manufacturing everything from high-definition cameras, to electronics and alloy wheels, which currently come from Germany, he said.

Theresa May all but ruled out full membership of the EU customs union in her Lancaster House speech setting out her goals for Brexit last month. And speculation that the UK may have to fall back on WTO rules was heightened by her declaration that “no deal is better than a bad deal”.

Lawther denied the company had struck a financial deal with May’s government when it agreed last year to build new Qashqai and X-Trail models in Sunderland.

He said that remarks made by the chief executive Carlos Ghosn last year demanding “compensation” for potential tax barriers post Brexit were misconstrued.



“Compensation in terms of what CEO says was misinterpreted; there was not a money connotation, Nissan is not interested in monetary compensation,” Lawther said.

“Our point has always been we believe we have to have a competitive business, and business propped up by grants or incentives is not a sustainable business. There is no side letter, no verbal assurances, there is no contingent liability in this letter.”

However, Lawther told the Commons international trade committee that the firm would constantly review its decision to stay in Sunderland.

The decision to expand in Sunderland was based on a set of circumstances at that point in time, he said. “As those circumstances change, and we wouldn’t wait until the end of the process, we will continually review the decisions that we take, based on anything that materially changes,” he added.

Liberal Democrat leader Tim Farron said his comments showed May’s so-called Brexit deals with Nissan were “[not] worth the paper they were written on”.