Britain wins race for flagship battery plant in boost for Rishi Sunak
Rishi Sunak has sealed a deal to bring an electric car battery plant to Somerset after offering half a billion pounds in subsidies to Jaguar Land Rover.
The carmaker’s parent company, India’s Tata Motors, is finalising an announcement to build its flagship battery plant in Britain after the UK trumped Spain to secure the investment.
Three sources said the investment could be announced as soon as Wednesday, representing a significant win for the Government to boost green technologies.
The Jaguar Land Rover battery plant is expected to generate up to 9,000 jobs in the South West of England.
The UK is facing stiff competition from the European Union and the White House, both of which have revealed incentive packages worth tens of billions of pounds to attract electric car companies and their suppliers.
The Treasury is reported to have offered up to £500m in subsidies to Tata to secure the plant, although Jaguar Land Rover previously denied it had been offered funding to influence the decision. Tata is also seeking up to £300m for its steelworks in Port Talbot.
Such a sum would represent a substantial bet on a single site by officials. Darren Jones, chairman of the Business and Trade Committee, said MPs would want to “reflect” on whether the subsidy required to secure battery investment was “scalable to meet the need for future battery manufacturing sites”.
The win would come despite Spain having €2bn of EU funds earmarked to boost its domestic electric vehicle sector. However, it had set a limit of €350m for financing new battery plants.
The win comes months after the collapse of Britishvolt, which had been hoping to build an electric car battery factory near Blyth. The electric car battery maker crumbled into administration before its assets were bought up by an Australian investment company.
Attracting battery supplies to the UK is seen as vital to keeping the industry competitive against Europe. A looming ban on the sale of new petrol and diesel cars from 2035 means a domestic supply chain is crucial.
Meanwhile, the Brexit deal means cars built using batteries imported from outside Europe will attract a 10pc tariff if shipped to the Continent.
In May, Stellantis, the owner of the Vauxhall brand, warned Parliament car plants would close in Britain unless Mr Sunak’s Brexit deal was altered to protect the car industry, risking tens of thousands of jobs.
A spokesman for the Government said it could not comment on commercial matters. A Jaguar Land Rover spokesman declined to comment. Tata could not be reached for comment.
This article was written by Matthew Field and Howard Mustoe from The Telegraph and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to legal@industrydive.com.