Nissan’s investment will not restore Britain’s car industry to glory

The grins on the faces of Rishi Sunak, the prime minister, and Jeremy Hunt, the chancellor of the exchequer, told their own story. The two men joined Uchida Makoto, the boss of Nissan, in Sunderland on November 24th for the Japanese car firm’s announcement that it will manufacture three electric models and build another battery plant in the city. Nissan’s commitment follows other bits of encouraging news for Britain’s automotive sector. But just how big a smile is warranted for an industry that has gone into in recent years?In the year to September 2017 British factories turned out 1.7m vehicles; back then it seemed to be on course to produce 2m cars a year. In the 12 months to September 2023 around half that number emerged. Britain still has many strengths: domestic engineering prowess, flexible labour laws and plentiful supplies of clean energy. But, for the industry to rebound, big foreign-owned car firms have to be convinced that Britain is still a good place to invest as the industry rapidly electrifies.