Re: This will have to hurt
Originally Posted by
Bread
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Well, here are a few more answers.
1. Nissan do not make the cars in the Sunderland plant in Spain so it would have to build a new factory in 6 months to do it and employ another 7000 people, plus supply chains etc etc. You still haven't answered how this can be done.
2. Spain has 25% corporation tax compared to the UK's 19% so making cars in Spain would be already a 6% extra hit on Nissan profits in Spain compared to here.
3. VAT is 1% higher in Spain than the UK so that's another 1% hit to Nissans taxes. Bearing in mind the UK will not be paying 5% EU vat from 31st December so this can be reduced, saving Nissan a further 5% in taxation.
4. Indonesia is not in the EU and already has a MFN 10% tariff applied to imports (or 6.5% in the case of Indonesia as it is a "preferred" country under the GSP rules).
5. Indonesia has a corporation tax rate 6% higher than the UK
6. The UK has better working rights than the EU - we have, for example, free health care for all employees, a minimum/living wage, more holidays, maternity and paternity pay, a contract for all employees that is legally binding including redundancy notices, we have sick pay etc etc etc
7. Tarrifs are passed on to the consumer anyway
So ....
How (and why) is Nissan moving to the EU before the end of the year. You still haven't answered my question.
1. But it does in indonesia. The nissan market is in decline.
2. 10% added in tariffs in case you don't get a deal with the EU makes the UK product 4% more expensive.
3. In spain vat on automotives is lower.
4. Car production is played on a world scale. Up your thinking.
5. And a production cost in labour 23% lower than UK.
6. All based on EU directives, and years later than other EU countries introduced them. That is why the EU wants to keep you level playing. If you had higher standards there would be no issue.
7. That's makes reducing costs all the more essential
So nissan doesn't need to move, just to close down another plant than previously envisaged.