Nissan UK sees profits rise - but warns of possible 'long-term' challenges

Nissan's Sunderland plant

Nissan's Sunderland plant

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Nissan has warned any 'substantive change' to the way the UK does business with the rest of the world post-Brexit could jeopardise its UK operation.

The firm employs almost 7,500 people in the UK - the vast majority of them at the Sunderland plant - and supports thousands more jobs in its nationwide supply chain.

New figures for the financial year to the end of March 2016 show Nissan Motor Manufacturing (UK) Ltd - based at the Sunderland factory - increased pre-tax profit by £21million, even though turnover was down.

The firm made a £117million profit before tax, up from £96million in the previous 12 months. Turnover was £5.18billion, down from £5.26billion to the end of March 2015.

The plant built 478,000 cars during the year, down from 481,000 in 2014/15, with Qashqai still massively popular.

Nissan built 296,000 of its best-selling model last year, a rise of 6,000, and 116,000 Jukes (down 4,000), while production of the all-electric Leaf held steady year-on-year at 17,000.

Demand for the Note fell substantially, down from 54,000 to 39,000. The plant stopped building the car in September as it stepped up Qashqai production.

Nissan announced earlier this year that it is to build two new models - a third version of the Qashqai and an new X-Trail - on Wearside, after global CEO Carlos Ghosn met Prime Minister Theresa May in Downing Street to seek assurances about the potential effects of the Brexit vote on the future of the car industry.

The annual report warns the biggest threat to the company's long-term future is 'loss of demand for its product' and adds: "The company is committed to maintaining its world class quality, cost, delivery and productivity so that the manufacturing plant and its associated facilities remain competitive and continue to attract investment in new models.

"The company continually monitors the UK competitive environment and any changes to this (whether caused by government, competitor activities, legal cases or similar) could add to the long-term challenges facing the business.

"Any substantive change to the trading arrangements between the UK and the rest of the world could limit the company's competitiveness."