Nissan is to commit to manufacturing future electric versions of two of its best-selling models at its Sunderland plant after months of talks with the government.
Sky News can reveal that the giant Japanese car manufacturer will announce on Friday that it will build new electric Qashqai and Juke models at the site – a decision that will help safeguard thousands of jobs there.
Sources said on Wednesday evening that Prime Minister Rishi Sunak and Chancellor Jeremy Hunt had been involved in the discussions with Nissan and were likely to play a role in this week’s announcement.
One added that the investment decision would involve a significant government funding guarantee, although it was unclear whether any taxpayer cash would be provided up front by taxpayers.
Nissan is expected to commit hundreds of millions of pounds and potentially more than £1bn to the project, automotive industry sources said.
The company began producing electric Juke and Qashqai cars in the North East last year.
The announcement will provide fresh evidence of Nissan’s long-term commitment to Sunderland after a period of uncertainty that the company said had been exacerbated by the 2016 Brexit referendum.
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Image: A car is seen on the production line at the Sunderland plant
In 2019, the company said it would no longer proceed with production of the X-Trail in the North East, deepening the gloom which engulfed the industry at the time.
It announced three years later that it would shut the area of its vast Sunderland factory dedicated to making cylinder heads for Renault combustion engines.
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Nissan’s Sunderland plant employs 6,000 people, comprising the bulk of the company’s British workforce.
It already makes the short-range electric Leaf model at the site.
Those employees now play a central role in what Nissan calls EV36Zero, its flagship manufacturing hub and electric vehicle ecosystem.
The project was launched in 2021 with an initial £1bn investment by Nissan and its industrial partners, bringing together electric vehicles, renewable energy and battery production.
It includes a huge gigafactory being built in partnership with Envision, a Chinese company.
In his autumn statement on Wednesday, Mr Hunt said the government would invest £4.5bn into British manufacturing from 2025.
That investment will be distributed across a range of sectors, including automotive and clean energy.
“Britain is now the eighth-largest manufacturer in the world, recently overtaking France,” Mr Hunt said.
“To build on this success, we are targeting funding to support the sectors where the UK is or could be world-leading.
“Our £4.5bn of funding will leverage many times that from the private sector, and in turn will grow our economy, creating more skilled, higher-paid jobs in new industries that will be built to last.”
It was unclear on Wednesday over what period the government funding guarantee for the new electric models would run, or how many electric Qashqai and Juke vehicles Nissan expects to produce at Sunderland over the next decade.
Nissan and the government declined to comment on Wednesday.
A trade deal with the US is “possible” but not “certain”, a senior minister has said as he struck a cautious tone about negotiations with the White House.
Pat McFadden, the Chancellor of the Duchy of Lancaster, told Sunday Morning with Trevor Phillips there was “a serious level of engagement going on at high levels” to secure a UK-US trade deal.
However, Mr McFadden, a key ally of Sir Keir Starmer, struck a more cautious tone than Chancellor Rachel Reeves on the prospect of a US trade deal, saying: “I think an agreement is possible – I don’t think it’s certain, and I don’t want to say it’s certain, but I think it’s possible.”
He went on to say the government wanted an “agreement in the UK’s interests” and not a “hasty deal”, amid fears from critics that Number 10 could acquiesce a deal that lowers food standards, for example, or changes certain taxes in a bid to persuade Donald Trump to lower some of the tariffs that have been placed on British goods.
And asked about the timing of the deal – following recent reports an agreement was imminent – Mr McFadden said: “We’ll keep working with the United States and keep trying to get to an agreement in the coming weeks.”
As well as talks with the US, the UK has also ramped up its efforts with the EU, with suggestions it could include a new EU youth mobility scheme that would allow under-30s from the bloc to live, work and study in the UK and vice versa.
Mr McFadden said he believed the government could “improve upon” the Brexit deal struck by Boris Johnson, saying it had caused “an awful lot of bureaucracy and costs here in the UK”.
He said “first and foremost” on the government’s agenda was securing a food and agriculture and a veterinary agreement, saying it was “such an important area for the UK and an area where we’ve had so much extra cost and bureaucracy because of Brexit”.
He added: “But again, as with the United States, there’s no point in calling the game before it’s done. We’ve still got work to do, and we’re doing that work with our partners in the EU.”
The Cabinet Office minister also rejected suggestions the UK would have to choose between pursuing a trade deal with the US and one with the EU – the latter of which has banned chlorinated chicken in its markets – as has the UK – but which the US has historically wanted.
On the issue of chlorinated chicken, Mr McFadden said the government had “made clear we will not water down animal welfare standards with either party”.
“But I don’t agree that it’s some fundamental choice beyond where we have to pick one trading partner rather than another. I think that’s to misunderstand the nature of the UK economy, and I don’t think would be in our interests to put all our eggs in one basket.”
Also speaking to Trevor Phillips was Tory leader Kemi Badenoch, who said the government should be close to closing the deal with the US “because we got very close last time President Trump was in office”.
She also insisted food standards should not be watered down in order to get a deal, saying she did not reach an agreement with Canada when she was in government for that reason.
“What Labour needs to do now is show that they can get a deal that isn’t making concessions, so we can have what we had last month before the trade tariffs, and we need serious people doing this,” she said.
UK economic growth could be “postponed” for two years amid a toxic cocktail of headwinds for confidence, according to a respected forecast which says further interest rate cuts may help lift the mood.
EY ITEM Club, which uses the Treasury’s economic modelling, downgraded expectations for output in both 2025 and 2026 in its latest report.
It warns of a direct hit from Donald Trump‘s trade war and from persistent high inflation in the UK economy.
But the forecast says the biggest impact would come from weaker sentiment among both households and businesses, given the surge in uncertainty and hits to global growth caused by the imposition of tariffs.
A “baseline” 10% tariff on imports from most countries around the world is in place while UK-produced steel, aluminium and cars are subject to duties of 25%.
Around 16% of all goods shipped abroad head for the United States typically but the study said that weaker demand for exports would likely hit that number.
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It forecast UK growth of 0.8% this year – down from the 1% it expected three months ago – and a figure of 0.9% for 2026.
That last figure represented a downgrade of 0.6 percentage points.
These are not the numbers the Treasury will want to see, coming in even lower than the International Monetary Fund’s downgrades last week, as it leads work on the government’s stated priority of securing economic growth.
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What IMF said about the economy
It has been accused of an own goal through the chancellor’s tax increases on business, which came into effect at the beginning of this month.
At the same time, households are grappling a surge in bills, including those for energy, water and council tax, which are threatening to depress spending power further.
Data on Friday showed a renewed slump in consumer confidence and sharp increases in the number of firms in “critical” financial distress and going to the wall.
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US trade deal ‘possible, not certain’
EY said the weaker global economic backdrop and spiralling levels of uncertainty would weigh on both families and businesses.
It warned the consumer mood remained “cautious” amid the continuing pressures on household budgets, further limiting demand for major purchases.
Anna Anthony, regional managing partner for EY UK & Ireland, said: “There had been signs that the economy was exceeding expectations in the opening months of 2025, but a combination of global trade disruption, uncertainty, and persistent inflation look likely to postpone the UK’s return to more moderate levels of growth.
“Businesses thrive on certainty, so it’s unsurprising that an unpredictable global market is translating into lower levels of business investment over the short term.
“While conditions remain challenging, there are still some grounds for optimism.
“The services-led UK economy is projected to see continued growth this year and gradual interest rate cuts should slowly bolster business and household spending.
“Over time, the unpredictable global landscape may offer opportunities for the UK to position itself as a stable, attractive destination for investment.”
Two chairs of FTSE-100 companies are vying to succeed Adam Crozier at the top of Whitbread, the London-listed group behind the Premier Inn hotel chain.
Sky News has learnt that Christine Hodgson, who chairs water company Severn Trent, and Andrew Martin, chair of the testing and inspection group Intertek, are the leading contenders for the Whitbread job.
Mr Crozier, who has chaired the leisure group since 2018, is expected to step down later this year.
The search, which has been taking place for several months, is expected to conclude in the coming weeks, according to one City source.
Ms Hodgson has some experience of the leisure industry, having served on the board of Ladbrokes Coral Group until 2017, while Mr Martin was a senior executive at the contract caterer Compass Group and finance chief at the travel agent First Choice Holidays.
Under Mr Crozier’s stewardship, Whitbread has been radically reshaped, selling its Costa Coffee subsidiary to The Coca-Cola Company in 2019 for nearly £4bn.
The company has also seen off an activist campaign spearheaded by Elliott Advisers, while Mr Crozier orchestrated the appointment of Dominic Paul, its chief executive, following Alison Brittain’s retirement.
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It said last year that it sees potential to grow the network from 86,000 UK bedrooms to 125,000 over the next decade or so.
Mr Crozier is one of Britain’s most seasoned boardroom figures, and now chairs BT Group and Kantar, the market research and data business backed by Bain Capital and WPP Group.
He previously ran the Football Association, ITV and – in between – Royal Mail Group.
On Friday, shares in Whitbread closed at £25.41, giving the company a market capitalisation of about £4.5bn.