In a strategic move to reinforce its operations in the UK, Nissan has entered into a preliminary agreement with Chinese automotive manufacturer Chery to assemble vehicles at its Sunderland plant. This partnership aims to commence production in the 2027 financial year and is poised to safeguard approximately 6,000 jobs at the largest car factory in the UK, marking a significant milestone in the domestic automotive sector.
Strategic Collaboration with Chery
Nissan’s non-binding agreement with Chery signifies a crucial step towards enhancing its manufacturing capacity and addressing the challenges posed by fluctuating demand in the automotive market. Chery, which has rapidly expanded its presence in the UK with brands such as Chery, Omoda, and Jaecoo, has seen notable success with models like the Jaecoo 7—a plug-in hybrid electric vehicle that topped sales charts in March.
Massimiliano Messina, Nissan’s regional chair, expressed optimism about the collaboration, stating, “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.”
Enhancing Job Security and Production Capacity
The Sunderland facility, renowned for its efficiency and output, currently produces models including the Qashqai SUV, Juke crossover, and the electric Leaf. Despite these successes, the plant has faced challenges due to broader market conditions and internal restructuring within Nissan. The recent consolidation of production lines at the Sunderland site, which did not result in job losses, has paved the way for this new venture with Chery.
In 2025, Sunderland’s production levels fell short of its capacity, with only 273,000 vehicles manufactured—a 3% decrease from the previous year. This partnership is expected to provide stability and potentially expand output, as Nissan aims to leverage Chery’s growing market presence in the UK.
Navigating a Changing Automotive Landscape
The collaboration between Nissan and Chery is significant given the increasing competition from Chinese automotive manufacturers in Europe. As Chinese brands gain traction, they have begun to establish a foothold in the European market, often at the expense of traditional rivals. The ability of these companies to offer competitively priced electrified vehicles is largely attributed to substantial state subsidies and cost advantages in manufacturing.
David Bailey, a business economics professor at the University of Birmingham, characterised this agreement as “historic,” noting, “Twenty years ago, Chinese brands were trying to break into Europe. Now they’re going to build cars in Britain’s biggest car factory. China isn’t just competing with western carmakers anymore: it’s becoming part of the industrial base.”
Broader Implications for the UK Automotive Industry
The potential deal with Chery reflects a broader trend in the automotive industry, where established manufacturers are increasingly collaborating with Chinese firms rather than attempting to protect their market share independently. Other European carmakers, such as Stellantis and Ford, have similarly engaged with Chinese companies to navigate a rapidly evolving landscape.
As Chery aspires to become a top-three manufacturer in the UK, it has also established a research and development centre in Liverpool, underscoring its commitment to the British market. While specifics about the types of vehicles that Nissan will produce for Chery remain undisclosed, the partnership represents a proactive approach to future-proofing jobs at Sunderland.
Why it Matters
The implications of Nissan’s partnership with Chery extend beyond mere job preservation; they signal a transformative moment for the UK automotive industry in the face of rising competition from Chinese manufacturers. As the sector grapples with changing consumer preferences and economic pressures, this collaboration could serve as a blueprint for future partnerships, fostering resilience and innovation within the industry. By embracing this shift, Nissan not only secures its workforce but also positions itself to thrive amid a landscape increasingly dominated by international players.
