Nissan decision to freeze investment in UK ahead of Brexit is 'understandable' says Sunderland University expert
Nissan's decision to freeze investment in its Sunderland plant is the inevitable result of uncertainty over Brexit, says a leading academic.
The Japanese giant's chairman and chief executive Carlos Ghosn has been reported by the BBC as saying the company's investment plans would be put on hold until there was more clarity on the shape of the UK's trading relationship with Europe after it leaves the EU.
Prof Lawrence Bellamy is Academic Dean in the University of Sunderland's Faculty of Business, Law and Tourism.
He said Nissan was simply acting responsibly in putting the brakes on further spending until the state of the UK's relationship to the EU post-Brexit was clear : "As a global industry, the automotive sector depends upon the ability to move components and vehicles across borders to and from the manufacturing plants," he said.
"It is, therefore, understandable - and normal due diligence – to put strategic investment and critical decisions on hold, until further information is available.”
The Nissan revelation comes just days after the North East England Chamber of Commerce wrote to Prime Minister written to Theresa May spelling out how the poor progress on Brexit negotiations was causing frustration and potential damage to businesses in the North East.
Chief executive James Ramsbotham said: “While we have accepted the referendum result, our members are exasperated at the lack of tangible progress towards a positive deal which isclearly hindering business planning.
"While our regional economy currently remains robust, we regularly hear about lower investor confidence, projects being delayed and skilled workers leaving for other countries due touncertainty over our future business landscape. This is being compounded by a lack of clarity from Government over its own preferred approach to Brexit.
At the heart of this lies woefully underwhelming levels of engagement and consultation by Government with local businesses. There are perfectly valid fears among our exporters that the Government’s stance on the Customs Union and Single Market will only serve to harm our ability to trade with our biggest export market.
"We presume the Government believes the ultimate outcome of the Brexit negotiations will both be better overall and significantly better for North East England, given its manifesto commitments.
"However, we’re yet to see any firm evidence on which to base this view. We have repeatedly heard Chamber member views raised by regional MPs in the House of Commons, but are yet to receive a sufficient answer in that place, or a response to the Chamber directly.
"How can we expect North East businesses to gain reassurance, when Government fails to address their legitimate concerns?”