Nissan has said it will invest £170m to build a new SUV at its factory in Sunderland, but has warned the move is subject to the UK weakening its electric vehicle sales mandate.
The new hybrid model, called the Kicks, represents Nissan's latest attempt to secure the future of the plant, which employs 6,000 people in Tyne and Wear and is Britain's biggest car factory. The site has been running at 50% capacity.
Massimiliano Messina, Nissan's head of operations in Europe, Asia, Africa and Oceania, said the investment would not create new jobs but was aimed at "securing and maintaining" existing employment at the site.
The Kicks will become the fourth Nissan model produced at Sunderland, joining the Qashqai, Juke and Leaf. The vehicle is already sold in more than 70 markets worldwide but has never previously been manufactured in Europe.
The announcement provides a boost to Britain's automotive sector, which was hit last week by news that Jaguar Land Rover will cut 4,000 jobs. Carmakers have faced mounting pressure from US tariffs, competition from Chinese rivals and high industrial energy costs in recent years.
Jonathan Reynolds, the business secretary, described the investment and new car model as "a huge vote of confidence in the UK's manufacturing expertise and automotive future".
However, the announcement came with an apparent caveat from Messina, who said: "Of course we're going to keep discussing with the UK government because large part of this is subject to the ZEV [Zero Emission Vehicles] mandate amendment."
The government is currently consulting on cutting the UK's electric vehicle sales targets for manufacturers. Under the existing ZEV mandate, carmakers must ensure a percentage of the cars they sell each year are zero-emissions, with the target rising annually to reach 80% by 2030.
Following heavy lobbying from manufacturers, the government said last month it was considering reducing that figure to as little as 50% by the end of the decade, and is consulting on the change until late October.
When asked whether Nissan would proceed with the investment if the targets were not relaxed, Messina said: "We try to assess always if this is more likely than unlikely." He added that the company was pushing for the target to be cut to 50%. "I just want to think that this is done," he said. "For me, yes, it's going to happen."
Separately, Nissan is in talks to share production with the Chinese carmaker Chery, which is seeking to build its own vehicles in the UK, in a move that could help bring the Sunderland site closer to full capacity. Messina said he was applying "pressure internally and externally" to finalise the deal, which was first announced in June. "We are ready to go. We are waiting just that Chery finalises volume and lineup," he said.
In a separate development, LEVC, the manufacturer of London's black cabs, said on Wednesday that it would launch its next-generation taxi model next year at its factory in Ansty, near Coventry. The company, which is owned by China's Geely, said the new taxi would replace the current all-electric TX range introduced in 2018.
Nissan is also lobbying Brussels over the European Union's "Made in Europe" rules, which would require vehicles to be built within the bloc in order to qualify for subsidies and public procurement contracts. The company has previously warned it could be forced to close its Sunderland plant if the rules proceed as currently drafted.
Messina said: "You might imagine how much time I'm spending on this to secure that this comes together in order to have Sunderland and the UK part of it. There are good indications that this will be achieved. We believe strongly, regardless what will be the outcome, that UK cannot be left anyway outside."
Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, said the investment was "a major boost for Nissan Sunderland, the thousands of highly skilled jobs it supports and the wider local supply chain".
On Wednesday, McLaren separately announced it would invest £500m in its UK operations, including a new factory, 1,000 jobs and its first SUV.
