Nissan in Spain

The automotive industry is a significant part of Spain’s economy. Spain not only manufactures vehicles for various automotive companies, but they also produce many of the parts to make the vehicles. They have a highly developed infrastructure to support this industry, which makes them the 2^nd largest exporter of automobiles in Europe. This article, written by Isa Soares on CNN.com (http://edition.cnn.com/2013/02/28/business/spain-auto-soares/), focuses on Nissan’s recent impact on Spain’s economy.

As you may already know, Spain’s economy has been recovering in recent years from a large financial crisis in 2008 that left the country in ruins. Spain’s GDP has fallen and their unemployment rate is currently around 26.7%. This article focuses on the economic recovery that is occurring in the automotive sector, specifically with Nissan. The Nissan branch is Spain is currently expanding and also hiring. When this article was written, February 28, 2014, Nissan Barcelona had been given 178 million dollars in an investment that would create 1,000 direct jobs and 3,000 indirect jobs. According to the article, this was possible due to Nissan’s negotiations with trade unions, which limited wages, giving the company flexibility with its workforce. Limiting the wages has given Spain an advantage over other European countries because they are able to supply more jobs for an economy that desperately needed it. Lower the labor costs is also making the automotive industry in Spain more competitive.

Other car companies are feeling the pressure that Nissan is supplying and may also do the same thing as well. Even though just lowering the labor costs is not enough to make them competitive on the global stage. According to the article, “It's this logistical innovation that has enabled Nissan Barcelona to cut costs by as much as 30%; and for an industry that accounts for 10% of Spain's industry, this is a crucial part of Spain's long haul to recovery.” Nissan has had an impact on Spain’s economy that will hopefully help them recover faster from their economic struggles. There may be people that complain about the lower wages, which may decrease the standard of living for those working, but with an unemployment rate of 26.7%, I think that is a risk that can be taken and is supported by many Spaniards.