Green light for Nissan’s ambition 2030

Nissan’s devotion to electrification and manufacturing in Britain, is compelling. Huge recent investments underline the company’s green plans and long-term future in the UK. Will domestic suppliers benefit as the switch over to electric bites and new, high-volume components are needed? By Will Stirling

It’s June 2016 and the EU Referendum result is in. Shock: the British public voted to leave the European Union. Pandemonium ensues. Prime Minister David Cameron resigns. The cost of exports to the EU will certainly rise. A business story sharp in the memory was Nissan’s then Chief Executive, Carlos Ghosn, warning that the carmaker could stop investing in its Sunderland plant if EU export tariffs were imposed once the UK left the bloc. New PM Theresa May made a famous deal with Nissan to neutralise the effect of Brexit on its trading conditions. But for a moment, Nissan – with the UK’s biggest car plant – had a public wobble about its future here.

Fast forward to March 2024 and things could not be more different.

Carmakers are seemingly vying to be the greenest on the market, but Nissan’s net zero plan is surely hard to beat. Last November, Nissan heavily ramped up its EV36zero strategy, a roadmap to electrification that it had launched in 2021. The roll call of investments was eye-catching. The company will build three fully electric models at its Sunderland plant as part of a new £2bn investment, which is on top of the £1bn it had already committed under EV36zero to create an electric vehicle (EV) hub. 

More battery gigafactories are planned; with AESC Envision’s original battery plant, there will be a total of three gigafactories in Sunderland by 2030. “There will also be a renewable energy microgrid, that will deliver 100% clean electricity for both Nissan and the suppliers around the plant, further action to accelerate that journey to carbon-neutral manufacturing,” said a press spokesperson for Nissan Motor Manufacturing UK. The third gigafactory will be needed to supply the expanded Sunderland plant and may have the capacity to sell batteries to other OEMs. Prime Minister Rishi Sunak said of the investment: “This venture will no doubt secure Sunderland’s future as the UK’s Silicon Valley for electric vehicle innovation and manufacturing.”

Many UK customers know the Leaf, the first mainstream electric car to be built in the UK, and for EVs, Nissan also produces the Ariya and the Townstar small electric van. More than one million Nissan EVs have been sold to date, and more than one-third of their batteries were manufactured at the AESC Envision plant, in Sunderland. The ‘Nissan Ambition 2030’ strategy’s aim is that all passenger car sales will be EVs in Europe by 2030.

As well as the multiple carbon-cutting projects in Sunderland, where over 6,000 people are employed, Nissan recently unveiled three new head-turning concept electric vehicles (not for manufacture in the UK): Nissan Hyper Urban, Hyper Punk, and Nissan Chill-Out. The job of these futuristic concept cars is to inspire take-up of the new production EV models. In fact, Chill-Out will be the design for the next-gen Nissan Leaf.

At the launch event on 24 November 2023, Nissan’s global president and CEO Makoto Uchida, said: “Exciting electric vehicles are at the heart of our plans to achieve carbon neutrality. It means our UK team will be designing, engineering and manufacturing the vehicles of the future, driving us towards an all-electric future for Nissan in Europe.”

As a nod to the prevalence of greenwashing, Uchida-san spoke of ‘Nissan Ambition 2030’ being not a slogan, but a reality. “We have a vision of exciting electric vehicles, a vision where your car can help your community manage energy, a vision where Nissan becomes a truly sustainable company, where our actions have a positive impact on the environment.”

In addition to the late 2023 investment, the UK government awarded £15m of funding for a £30m collaborative project led by Nissan to support its carbon-cutting programme.

e-POWER offers a hybrid solution

And it’s not all about pure electric, as hybrid vehicles have proved popular while EV price tags remain high. Seen as Nissan’s answer to mild hybrid, e-POWER is its unique electric-drive powertrain that integrates a petrol engine that generates electricity, and a motor that transfers the power. Since its debut in September 2022, more than 100,000 vehicles powered by Nissan’s e-POWER have been delivered. e-POWER utilises motor control technology cultivated in past EV development activities, powertrain integration technology and energy management technology. By changing the combination of electric-drive motors and power-generation engines, it delivers quiet driving with excellent response over a wide range of vehicles from compact cars to minivans and SUVs.

Manufacturing and supply chains

By investing in three new all-electric models and the total £3bn now being invested in EV36zero; jobs and prosperity from Nissan Sunderland are assured for decades to come.

The batteries, the most substantial component in an EV by value, will be supplied by Nissan’s gigafactories. Britain needs more battery capacity to satisfy future production. As part of the three new EVs announcement, Nissan said it had initiated a feasibility study to explore potential further gigafactory investments in the UK. Nissan’s batteries are an NMC design, nickel manganese cobalt, rather than other primary mainstream battery designs like LPF – but in fact, both are lithium-ion batteries. This could potentially boost demand for UK-sourced lithium, from suppliers like Imerys British Lithium, because from 2027, materials and parts sourced outside the UK and EU will face tariffs under the EU Trade and Cooperation Agreement. A problem for UK and EU battery makers is the rising cost of materials, especially lithium.

 But these vehicles also need power electronics, motors, inverters, transmission systems, DC converters, charger ports and other electromechanical parts.

Nissan’s UK business supports hundreds of component suppliers and is hugely valuable to the UK automotive industry, and the economy of the North East. Tier one suppliers such as Adient (seating), Unipres, which make press-formed and hot-pressed automotive components and body mountings are co-located at the Sunderland site. Under the bonnet, however, electric vehicles need different and fewer components. How will the switch to EVs affect Nissan’s suppliers, which rely on tens of millions of pounds in contracts?

“Our work on just transitions suggests that workers in the North East are more confident about the transition to making EVs than workers in the West Midlands,” said Professor David Bailey, Professor of Business Economics at the Birmingham Business School and a senior fellow of the ESRC’s UK in a Changing Europe programme. “The commitment of Nissan to EV production and sourcing locally made batteries is a large part of that, with a benefit to the local supply chain.” 

 “And yet there are still challenges,” Bailey adds. “Nissan production has picked up from the lows of the Covid pandemic but is still at something like 2/3rds peak production back in 2016. Furthermore, looking forward to the switch to making EVs will need far fewer components than making ICE cars. That will mean fewer jobs in the local supply chain. Diversifying the supply chain will be crucial for maintaining manufacturing capacity and ensuring a just transition.”

Carmakers compete to be green

As sustainability is a much stronger criterion for consumer purchases now, car companies compete to show their low-carbon, sustainable business credentials.  In an analysis by information site Eupedia, that averaged the ‘green’ rankings of car and tyre makers by different organisations’ green monitors, including S&P Global and the Carbon Disclosure Project (CDP), Nissan ranked 9th among 22 car OEMs. It scored 100% on all CDP metrics but scored 70 on the CSRHub, while the top 10 scored from 82 to 95.  CSRHub provides ratings of Corporate Social Responsibility (CSR) using 12 indicators of employee, environment, community and governance performance. Nissan’s new Ambition 2030 is likely to pull up these scores when the green and governance actions have had time to bed in.

Certainly, Nissan’s devotion to green vehicles is a welcome boost to the EV industry, which is suffering. Private sales of EVs have slowed – 2023 orders were flat in 2022, according to the SMMT, the Society of Motor Manufacturers and Traders. A recent House of Lords Environment and Climate Change Committee report on the EV industry says the UK’s EV strategy needs a recharge. Some of this is due to a seemingly coordinated anti-EV campaign in the media. Quentin Willson, the former TV motor journalist, writes in Just Auto: “Anybody remotely involved with EVs, and electrification, will have seen relentless anti-EV narratives in the media over the last two years. Some papers run an anti-EV story every day – literally.” Public opinion and public relations to promote EV’s benefits both need to move for the important changes happening at Nissan UK and elsewhere to realise their full potential.