GSR Capital is moving to secure jobs in Sunderland, and expand in China and Europe © Nissan
GSR Capital is moving to secure jobs in Sunderland, and expand in China and Europe © Nissan

Nissan to sell its UK and US battery operations to Chinese firm

9 August 2017

Nissan and NEC have agreed to sell their rechargeable electric battery joint venture (JV) to Chinese investment firm GSR Capital for an undisclosed fee. 

The sale will cover the JV Automotive Energy Supply Corporation (AESC), Nissan’s battery manufacturing operations in the US and UK, and part of Nissan’s battery development and engineering operations based in Japan, according to Nissan.

The car manufacturer has provided no financial terms, but analysts at the Financial Times predict a price tag for the business of around $1bn.

Nissan and IT solutions firm NEC set up AESC in 2007 to produce lithium-ion batteries for the car firm.

Nissan has been seeking a buyer of its 51% stake in AESC since last year while NEC has also been in talks with GSR about buying its 49% stake in the JV, according to Nikkei Asian Review.

The battery industry, although popular because of rising demand for electric vehicles, is capital-intensive.

Nissan said it would buy the 49% stake owned by NEC and its battery and electrode subsidiary NEC Energy Devices first and would then proceed with the sale once it had full control of the business.

Hiroto Saikawa, president and CEO of Nissan, dispelled fears over job losses and pledged that the entire workforce at both its UK Sunderland and US Tennessee facilities would continue to be employed. 

“This is a win-win for AESC and Nissan. It enables AESC to utilise GSR’s wide networks and proactive investment to expand its customer base and further increase competitiveness. In turn, this will further enhance Nissan’s electric vehicle competitiveness,” he said.

“AESC will remain a very important partner for Nissan as we deepen our focus on designing and producing market-leading electric vehicles.”

Responding to the move to secure jobs at Nissan’s UK facility, Julie Elliott, Sunderland Central MP, said: “At a time when demand for electric batteries is set to take off, any move which appears to secure local jobs in the industry must be cautiously welcomed.

“I understand around 300 employees in Sunderland will be affected by this sale and a consultation has begun to transfer their employment to the new company under TUPE regulations,” she said.

Global supply chain capabilities

Sonny Wu, chairman of GSR Capital, said the acquisition of AESC represented an important step in the new energy vehicle supply chain.

“We plan to further invest in research and development, expand production capacity in the US, UK and Japan and also establish new facilities in China and Europe to better serve global customers with our global supply chain capabilities and safety first engineering DNA,” he said. 

“With these capabilities and plans added to the battery business’ already skilled workforce, high technical capabilities and proven product-quality track record, we will be in a very good position for growth.”

China is increasingly focused on the global battery market amid rising demand for electric cars, with the Chinese government calling on domestic companies to double electric vehicle battery capacity by 2020 earlier this year. 

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