Nissan said Thursday it would close its plant at Barcelona’s Zona Franca, threatening about 3,000 jobs and triggering a scramble among politicians to figure out a contingency plan.
Nissan’s Chief Executive Makoto Uchida confirmed the closure during a video press conference on Thursday in which he announced sweeping restructuring. That’s a major blow for Spain’s Prime Minister Pedro Sánchez, who had insisted earlier this year that the factory’s future was “guaranteed.”
“We considered various measures in Barcelona and although it was a very difficult decision we intend to close the plant,” said Uchida.
On Wednesday, Nissan agreed a new cooperation program with Renault that will see the French carmaker take the lead in Europe as the whole auto industry grapples with expensive shifts in electromobility and autonomous driving systems, as well as the impact of the pandemic.
The closure of the Barcelona factory, which dates back to 1920 but has only been owned by Nissan since 1980, is hardly a surprise. The site had been operating far below its maximum capacity since 2012 and concerns over its viability increased months ago when Nissan cut 600 jobs to reduce costs.
However, Nissan said it will keep open its Sunderland factory in the U.K., despite fears that Brexit could lead to its closure. Its peer Honda last year announced plans to close its Swindon plant in the U.K. by 2022, costing 3,500 jobs.
In its announcement on Thursday, Nissan said it will now redirect its resources toward Japan, China and the United States, giving ground to Renault in Continental Europe.
The production of vans will be shifted from Barcelona to Renault’s French factories.
The decision is a big blow to manufacturing and employment in Spain’s northeastern region of Catalonia, where carmaking has been a crucial sector for decades. About 3,000 direct jobs and between 25,000 and 30,000 indirect jobs depend on Barcelona’s Zona Franca factory.
The decision also represents a failure for Sánchez after months of intense negotiations to persuade Nissan to keep the factory open.
“We regret this decision by Nissan … despite the enormous efforts by the government to keep the business going,” Spain’s Foreign Minister Arancha González said.
Spain insists that saving the Barcelona site is still possible if Nissan were to apply a viability plan developed jointly with the Spanish Ministry of Industry and the Catalan regional government. Spain and Catalonia had offered an injection of up to €100 million — about a third of what Nissan needed to invest to build a new electric vehicle at the Barcelona factory that would ensure its long-term viability.
Spain is determined not to make Nissan’s exit easy. The government argues that closing the factory would cost the company more than €1 billion in compensation to workers and suppliers, as well as the repayment of €25 million in taxpayer money handed to Nissan over the last 12 years. Madrid says that it would be cheaper for Nissan to invest and save the site.
The government also warned that leaving Barcelona and Spain equals “abandoning the European Union, with the consequent reputational damage in a market of more than 500 million people.”
Economic Affairs Minister Nadia Calviño said Thursday the government wants to discuss “an alternative solution” for the Zona Franca site with Nissan and has proposed the creation of a working group.
Unions plan street protests after weeks of being banned from doing so because of Barcelona’s lockdown restrictions. A strike that began on May 4 is set to continue.
“Nissan’s workers will not rest until they persuade the multinational to keep industrial operations in Spain,” said the CCOO union.
Nissan’s decision does not directly affect the future of the company’s other sites in northern Spain, including Ávila, where it produces spare parts, and Cantabria, where it manufactures electric vans.
Aitor Hernández-Morales contributed reporting.