Nissan to Contract-Manufacture Cars for Chinese State-Part-Owned Chery at UK Sunderland Plant from 2027

Nissan signed a non-binding agreement with Chinese manufacturer Chery to discuss contract manufacturing of cars at the Sunderland plant in northern England. The Japanese automaker said Wednesday that discussions are ongoing and that, if the deal proceeds, production for Chery International UK would begin on Sunderland’s production line 1 in the 2027 financial year.

The Nissan Sunderland factory employs about 6,000 workers and produces the Qashqai SUV, the Juke crossover SUV, and the electric Leaf.

The company last month consolidated production at the site into one of its two factory lines, a move that did not involve job losses and left the second line available. Chery has sold vehicles in the UK under the Chery, Omoda and Jaecoo brands in recent months. The Jaecoo 7 plug-in hybrid electric vehicle, built in China, was the top-selling model in the UK in March.

The companies did not disclose whether any vehicles built for Chery at Sunderland would be hybrid or electric. Massimiliano Messina, chair at Nissan for markets including Europe, said: “This is an important step forward for our operations. ” Nissan is undergoing a global restructuring that includes the closure of several plants in Japan.

Last month the company cut 900 jobs across Europe, including a small number of office roles in the UK. Ivan Espinosa, Nissan’s chief executive, said last year that the company was considering making cars with Dongfeng, another Chinese carmaker. Gary Lan, the UK chief executive of Omoda and Jaecoo, said last month that Chery wanted to be a “top three” manufacturer by sales in Britain and that producing vehicles in the UK was on its agenda within the next few months.

Chery has opened a research and development headquarters for commercial vehicles in Liverpool. The British government had raised the possibility of Jaguar Land Rover building cars for Chery. A senior executive at Jaguar Land Rover said that option was not under serious consideration.

Chery is part-owned by the Chinese state.