JATCO, Nissan’s subsidiary, has abandoned its plan to produce electric vehicle drive systems in Sunderland, UK, in a move that reflects the growing pressure facing the Japanese automaker as demand for its EVs slows across Europe.
According to Japan’s Nikkei newspaper, JATCO had announced in January 2025 an investment worth £48.7 million, equivalent to around $65.39 million, to manufacture integrated electric drive systems at the Sunderland plant. The project aimed to produce up to 340,000 units annually for Nissan electric vehicles.
These units combine the electric motor, inverter, and reduction gear into a single system, making them a key component in modern electric cars. The project was expected to support Nissan’s expansion in the European EV market, especially given the strategic importance of the Sunderland factory to the company’s UK operations.
However, the situation has shifted in recent months, with Nissan sales declining in major markets such as the United States and China, alongside weakening demand for its electric vehicles in Europe. As a result, Nissan previously announced a broad restructuring plan that includes reducing its global vehicle production plants from 17 factories to just 10, in addition to reviewing its powertrain facilities worldwide.
Nissan did not immediately comment on the report, while JATCO also did not respond to inquiries sent through its official website at the time of publication.
This decision highlights how the transition toward electric vehicles is not progressing as quickly as many automakers had expected a few years ago. While some markets continue to strongly support EV adoption, major manufacturers are increasingly facing challenges related to demand, costs, competition, and shifting consumer priorities.
For Nissan, canceling the Sunderland project may be part of a wider effort to reorganize priorities and reduce expenses at a time when the company needs to regain strength in global markets before committing to major new electric vehicle investments.
