The company's official statement said that in order to support heavy investment in new technology and equipment at its Sunderland operations (where the Juke, Qashqai and Leaf models will continue to be produced) it has chose to consolidate the X-Trail's production in its Japanese facility.
Meanwhile, a government minister has said Nissan will still get its money.
"It will be a critical priority of our negotiation to support United Kingdom vehicle manufacturers and ensure that their ability to export to and from the European Union is not adversely affected by the U.K.'s future relationship with the EU". "It is contingent too on a positive decision by the Nissan board to allocate production of the Qashqai and X-Trail models to the Sunderland plant".
"We will set our ambitions high and vigorously pursue continued access to the European market as an objective in future negotiations".
Auto maker Nissan has scrapped plans to build its new X-Trail 4x4 in Britain, saying it had taken the decision to consolidate production in Japan and warning two months before Brexit that uncertainty was making it harder to plan for the future. The secretary told parliament Monday that as a result an offer of grants totaling 61 million pounds was made on June 21, 2018, and of them, 2.6 million pounds has already been paid.
But on Sunday, Nissan, which operates Britain's single-biggest vehicle factory where it built approximately 30 per cent of the country's 1.52 million cars produced past year, said it was reversing that decision.
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The timing of the announcement comes just two days after an EU-Japan free trade agreement kicked in, which includes the European Union's commitment to removing tariffs of 10 percent on imported Japanese cars.
"The letter, written in October 2016, shows Nissan and the UK Government's continued desire to support investment in the UK and maintain Sunderland as one of Nissan's manufacturing hubs in Europe", the company said on Monday.
Mr Ramsbotham said: "The automotive sector in this country is vitally important and needs to be protected".
The company said planned investment in the next-generation Juke and Qashqai, also announced in 2016, was unaffected.
"It was shortly after his demise I said. that we may see a re-evaluation of some of those investment decisions, that is exactly what we've seen".
Investment for emissions regulations, reduced sales forecasts and Brexit uncertainty were cited as reasons for the decision.