A general view of the Nissan car plant in Sunderland, Britain, taken on February 4 2019. Picture: REUTERS/PHIL NOBLEe
A general view of the Nissan car plant in Sunderland, Britain, taken on February 4 2019. Picture: REUTERS/PHIL NOBLEe

London — Theresa May is launching a new working group to look for a Plan B on Brexit, but the prime minister’s latest initiative comes too late to stop businesses such as Nissan from ditching commitments to Britain.

The Japanese carmaker cited ongoing doubts about the UK’s split from the EU in its decision to scrap plans to build a new vehicle model in the country.

May’s government had previously gone out on a limb to safeguard Nissan’s investment in the UK, offering private assurances to the company. The Times newspaper suggested ministers will now consider withdrawing a £60m ($78m) package of support for Nissan.

“We appreciate this will be disappointing for our UK team and partners,” Nissan Europe chair Gianluca de Ficchy said in a statement on Sunday. “The continued uncertainty around the UK’s future relationship with the EU is not helping companies like ours to plan for the future.”

Business secretary Greg Clark described Nissan’s decision as “a blow to the sector and the region.” Speaking to the Financial Times, he said the announcement was a “warning sign” of the damage that would follow a no-deal Brexit.

As time runs short to secure a divorce accord with the EU, May is expected to return to Brussels within days in an attempt to rewrite the most difficult chapter in the draft agreement — on the Irish border backstop plan.

May is seeking a seemingly impossible compromise between the minimal changes that Brussels says it will consider, and the radical rewrite that euro-skeptics in her Conservative Party are demanding.

On Monday the premier will launch a new government working group intended to unite the feuding pro- and anti-Brexit factions within the party, according to May’s office. The body will explore “alternative arrangements” for avoiding a hard border with Ireland, after parliament voted to reject the so-called backstop plan last week.

Home secretary Sajid Javid said the technology already exists to replace the proposed backstop, which critics fear would tie the UK into the EU’s customs rules indefinitely.

Speaking to the BBC on Sunday, Javid said border enforcement officials told him currently available technological systems mean there is no need for checkpoints and other infrastructure on the UK’s land border with Ireland after Brexit.

But one of the EU’s most senior Brexit officials slapped down the idea in a tweet that she said was “fact-checking” British policy. “Can technology solve the Irish border problem?” Sabine Weyand, the EU’s deputy chief negotiator, wrote on Sunday. “Short answer: not in the next few years.”

There is no sign that the standoff will end soon, whatever the cost for businesses. The government expects negotiations to go down to the wire, leaving the threat of a chaotic no-deal split that casts a shadow over companies right up to next month’s deadline.

“It’s inevitable that in these types of negotiations things do get decided close to the last minute — that’s when the maximum political pressure is,” chief secretary to the treasury Liz Truss told BBC Radio 5 Live.

Truss insisted that the “threat of no deal” must be maintained to get the EU “on board,” and also because it is already helping to bring parliament closer to a consensus.

Her comments suggest the final eight weeks until March 29 — the UK’s scheduled exit day — will be fraught with tension.

Bloomberg