Nissan is expected to announce that it is cancelling a planned investment at its plant in Sunderland.

Liam Fox has said leaving the European Union without a deal will be “survivable”.

The international trade secretary told Sophy Ridge on Sunday that it would not be in Britain’s best interest to leave without a deal in place with the European Union, and admitted it could put the economy “into a position of unnecessary turmoil”.

He said: “We would be able to deal with that scenario but it wouldn’t be in our interest to go there.

“It seems to me we have got to guard against two things. One is an irrational pessimism that says that everything will be a catastrophe and irrational optimism which says everything will be okay.

“The truth lies between the two.”

But he cautioned against relying on World Trade Organisation terms, which is what Britain will revert to trading on if no deal is reached.

He said: “If WTO was so good people wouldn’t be looking to have trade agreements or customs unions which are ways in which you can further improve on those WTO rules.

“It has always seemed to me a bit strange that people would say ‘well we don’t need to worry about having a future trade deal with Europe, we can operate on WTO terms’, while at the same time saying we should have a free trade agreement with the United States to get away from WTO rules. We have to be consistent.”

Nissan has told staff in Sunderland the company will not make the new X-Trail there as previously planned.

The minister appeared to back a scenario where Article 50 had to be extended, saying it could be needed to ensure legislation goes through in time.

However, he said the clause which triggered the UK’s withdrawal from the EU – giving the country two years to negotiate an exit deal – should not be extended if there is no deal in place.

He said: “To extend simply because we hadn’t reached an agreement would not provide any impetus for that agreement to be reached and in any case, there is no guarantee the EU would want to do that.”

Shadow trade secretary Barry Gardiner said news of Nissan's plans were a 'significant blow' and he was 'deeply concerned'.

Shadow trade secretary Barry Gardiner said news of Nissan’s plans were a ‘significant blow’ and he was ‘deeply concerned’.

Dr Fox’s comments came shortly before Home Secretary Sajid Javid appeared to contradict comments from other cabinet ministers and suggested a technological solution to the hard border on the island of Ireland was easy to find.

Mr Javid told the BBC’s The Andrew Marr Show: “What matters is legislation – we are planning to leave on March 29 and I want that to be with a deal.

“First we must try to find an alternative to the backstop.

“In my own department I have got Border Force and I asked Border Force months ago to advise me to look at what alternative arrangements were possible.

“They have shown me quite clearly you can have no hard border on the island of Ireland and you can use existing technology.

“It is perfectly possible, the only thing missing is a bit of goodwill on the EU side.”

Earlier this week, Business Secretary Greg Clark said he did not believe technology to facilitate a soft border existed yet.

Theresa May is to travel back to Brussels this week having secured a mandate from the Commons to get an alternative arrangement to the backstop to prevent a hard border in Ireland.

Leaders in the EU have previously warned that there is no alternative arrangement to the border problem on the island of Ireland, but Mr Javid said there would be alternative arrangements in the event of a no-deal Brexit.

He said: “Michel Barnier himself said, if there is a no-deal situation, that the EU will help create alternative arrangements for the border.

“And if they can do it in a ‘no deal’ scenario, why can’t they do it in a deal scenario? So there’s your answer and that is why I think the most likely outcome is still a deal.”

Heiko Maas, Germany’s foreign minister, said they would be seeking “clear proposals from London” and rejected the idea that the EU was increasing the risk of a no-deal Brexit.

Mrs May pledged to battle for Britain in a column in the Sunday Telegraph but she faces new pressure after Nissan confirmed it would withdraw its plans to manufacture the X-Trail SUV in Sunderland.

The car firm’s plans had been considered a boost to Brexit Britain, but the withdrawal will be leapt on by Remain MPs who will use it to heap pressure on the prime minister to avoid a no-deal Brexit.

Julie Elliott, Sunderland Central MP, said tens of thousands of jobs relied on Nissan and other forms of production in the North East and despite her constituency voting to leave the EU there was “nothing to convince me that crashing out with no deal will benefit us”.

Rumours of a general election being held in June were quashed by Mr Javid, who said Conservative Party headquarters were only planning for local elections later this year.

He added: “I think the last thing this country needs is a general election. I think the people will never forgive us for it, what they want is this parliament to deliver Brexit in an orderly way, that is what they are looking for.”

Sunderland MP Julie Elliott said tens of thousands of jobs rely on Nissan
Sunderland MP Julie Elliott said tens of thousands of jobs rely on Nissan

Mrs May also faces continuing calls for a second referendum, dubbed a People’s Vote, with MPs in several parties urging her to consider taking the deal back to the public to be voted on.

The prime minister has repeatedly refused to hold another vote, but Liberal Democrat leader Vince Cable said it was not a “unicorn”, adding it was a “question of timing”.

He said: “Parliament is going to reject no deal.

“We may get to a point, a few weeks from here, where the government comes to the conclusion that the only way to get the deal to progress is to take it back to the people.”

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