Nissan is expanding hybrid vehicle production in the United Kingdom with plans to manufacture a new compact SUV for European customers at its Sunderland factory, strengthening the
Japanese automaker’s commitment to one of Britain’s most important automotive manufacturing sites.
The company announced on Wednesday that it will invest £170 million ($229 million) to prepare the Sunderland facility for production of the Kicks e-POWER, a hybrid SUV designed for the European market. Nissan has not yet disclosed when manufacturing of the new model is expected to begin.
The Kicks e-POWER will join several established Nissan models already produced at Sunderland, including the Qashqai, Juke and electric Leaf. The addition of another model is expected to broaden the range of vehicles manufactured at the plant and increase its role in Nissan’s European production network.
The investment comes at a significant moment for both Nissan and the UK automotive industry. Sunderland is the largest car assembly plant in Britain, but its future has recently attracted considerable attention as Nissan undertakes a wide-ranging restructuring programme aimed at reducing costs and improving efficiency.
As part of that restructuring, Nissan has been reviewing its global manufacturing footprint, reducing its workforce and reconsidering some planned vehicle programmes. The company has also postponed or cancelled several projects, including development of an electric version of the Qashqai, as it adjusts its strategy in response to changing market conditions and the high cost of transitioning to electric vehicles.
Against this backdrop, the decision to allocate a new model to Sunderland represents an important commitment to the British facility.
Nissan has been examining ways to make more efficient use of the Sunderland site. In June, the automaker said it was considering leasing one of the plant’s two production lines to Chery, the rapidly expanding Chinese car manufacturer. The arrangement would potentially allow Chery to use part of the existing facility to manufacture vehicles for the UK and European markets while Nissan continues its own operations at Sunderland.
The British government has also been involved in discussions concerning the plant's longer-term future. Reuters reported in June that officials were in advanced negotiations with Nissan over potential financial support linked to a long-term commitment to maintain investment and production at Sunderland.
The latest announcement could therefore provide additional reassurance about the plant’s position within Nissan’s European strategy.
UK Business Secretary Jonathan Reynolds described the decision as a major endorsement of British automotive manufacturing.
“The decision to build this new model in Sunderland is a huge vote of confidence in the UK’s manufacturing expertise and automotive future,” Reynolds said.
The investment also reflects the changing composition of Europe's automotive market. Hybrid vehicles have continued to play an important role as manufacturers balance demand for conventional engines with increasingly stringent emissions requirements and the gradual expansion of fully electric vehicles.
Nissan’s e-POWER technology differs from a conventional hybrid system in its driving configuration: the petrol engine is primarily used to generate electricity, while the wheels are driven by an electric motor. The system is intended to provide an electric-car-style driving experience without requiring the vehicle to be charged from an external power source.
For Sunderland, the arrival of the Kicks e-POWER provides another model around which production can be organised as the European automotive sector undergoes a major technological and competitive transformation. It also comes as manufacturers face growing competition from Chinese automakers, pressure to reduce production costs and uncertainty over the pace at which consumers are moving from petrol-powered vehicles to hybrids and battery-electric cars.
Nissan has not yet provided details on the expected production volume of the new Kicks e-POWER at Sunderland. The company also has yet to announce a start date for manufacturing.
Nevertheless, the £170 million commitment adds a new element to Nissan’s ongoing restructuring: while the automaker is cutting costs and reconsidering some future programmes, it is simultaneously directing fresh investment toward production of a new European-market vehicle in Britain. Photo by Kevauto, Wikimedia commons.
