EnNissan has reformulated its supply chain strategy in response to Brexit and will now produce its X-Trail SUV in Japan rather than in the United Kingdom, Reuters reports. That came despite British government offers of financial support for the factory but “continued uncertainty around the UK’s future relationship with the EU is not helping” according to Nissan’s European Chairman Gianluca de Ficchy.
Panjiva analysis of official data shows the U.K. automotive export industry was worth £33.7 billion ($44.0 billion) in the 12 months to Nov. 30. There’s already been a downturn in shipments to the EU, which fell 8.3% year over year and accounted for 36.6% of U.K. car exports.
Meanwhile the U.S. has become an increasingly important market after shipments improved by 6.6% and represented 23.3% of the total. Indeed, there may be signs of pre-Brexit stockpiling in the U.S. given shipments jumped 26.1% year over year in the three months to Nov. 30.
Source: Panjiva
Exports to the U.S. also face the specter of the U.S. section 232 review of the automotive industry, discussed in Panjiva research of Jan. 15. The process could be blocked by Congress, and while the U.K. is part of the EU it is protected by the tariff ceasefire agreed between President Donald Trump and President Jean-Claude Juncker. Outside the EU though Britain’s ability to fend of such tariffs will be limited.
That could have a direct impact on Nissan’s wider production in the U.S. which includes shipments of Infiniti-branded vehicles, Panjiva data shows. Nissan’s U.S.-bound shipments from the U.K. of Infiniti Q30 vehicles fell 27.4% in 2018 compared to 2017, likely reflecting weak sales in the U.S. Its shipments from Japan meanwhile climbed 14.2%.
Source: Panjiva
