Nissan has agreed to explore building cars for Chinese manufacturer Chery at its Sunderland plant, a move that would secure jobs at the UK's largest car factory. The Japanese carmaker on Wednesday announced it had signed a non-binding agreement, with ongoing discussions over contract manufacturing for Chery, which is part-owned by the Chinese state.
If the deal proceeds, Nissan aims to begin manufacturing cars for Chery International UK at Sunderland's production line 1 in the 2027 financial year. Chery has recently introduced vehicles in the UK under its Chery, Omoda, and Jaecoo brands. The Jaecoo 7, a plug-in hybrid electric vehicle built in China, became the UK's top-selling model in March.
Massimiliano Messina, chair of Nissan for markets including Europe, stated: "This is an important step forward for our operations. We are looking forward to working with Chery International UK in the coming months to finalise a position that is optimal for both companies."
The Sunderland factory, employing around 6,000 workers, is considered one of Europe's most efficient plants, producing the Qashqai SUV, Juke crossover, and electric Leaf. However, it has faced challenges from turmoil at its Japanese parent and sluggish European car sales post-pandemic. Nissan is undergoing a global restructuring, including plant closures in Japan.
Last month, Nissan consolidated Sunderland production into one of two lines, without job losses, creating capacity for a Chinese partner. Simultaneously, the company cut 900 jobs across Europe, including a few UK office roles. CEO Ivan Espinosa had previously mentioned considering vehicle production with Dongfeng, another Chinese carmaker.
Gary Lan, UK chief executive of Omoda and Jaecoo, said last month that Chery aims to be a "top three" manufacturer in the UK and hinted at UK production within months. Chery has also opened a research and development hub for commercial vehicles in Liverpool, underscoring its commitment. The companies did not specify whether Nissan would produce hybrid or electric cars in the UK.
The British government had suggested Jaguar Land Rover might build cars for Chery, but a senior executive at the UK's largest automotive employer said that was not under serious consideration.
