The Indian owner of Jaguar Land Rover has revealed plans to build a £4 billion (€4.6 billion) battery factory in the UK – a move the British government says will create around 4,000 jobs.
The plant – widely reported to be set for Somerset – will become one of Europe’s largest battery cell manufacturing sites when it starts producing in 2026, Tata Sons said on Wednesday.
It will produce about 40 gigawatt hours of battery cells every year. The UK government said that is enough to provide about half the battery production the UK will need by 2030 according to the Faraday Institution.
Today, the Tata group announced plans to establish a global 40GW battery cell gigafactory in the United Kingdom. Here's a message from our Chairman N. Chandrasekaran on this occasion. #ThisIsTata pic.twitter.com/y7Oypj0S94
— Tata Group (@TataCompanies) July 19, 2023
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The British government said it stepped in with subsidies to entice Tata Sons, which owns Tata Group, to build the plant in the UK. It did not say how much money it promised.
“The exact numbers on this will come out in the normal way. Because of the commercial sensitivities, they have to be released in the usual way,” said UK energy security S=secretary Grant Shapps.
Tata Sons chairman Natarajan Chandrasekaran said: “Our multibillion-pound investment will bring state-of-the-art technology to the country, helping to power the automotive sector’s transition to electric mobility, anchored by our own business, JLR.”
The car battery factory is expected to be built near Bridgwater in Somerset, where it will have close access to the new Hinkley Point C nuclear power station, which is expected to open later this decade.
But Tata could not confirm the location.
On Thursday, voters in the nearby Somerton and Frome constituency are set to vote in a by-election to select a replacement for its former MP, David Warburton.
The news comes weeks after reports emerged that Tata had selected a Somerset site for a gigafactory. The group reportedly considered a site in Spain as an alternative.
Reports on Tuesday suggested the UK offered major subsidies to attract the industrial giant to British shores.
Asked on BBC Breakfast about a Financial Times report that the British government is providing £1.5 billion in subsidies, Mr Shapps said: “That doesn’t sound right to me.”
Nor would UK chancellor Jeremy Hunt be drawn on how much the British overnment is providing to Tata, calling the discussions “commercially sensitive”.
Mr Chandrasekaran said: “I also want to thank His Majesty’s Government, which has worked so closely with us to enable this investment.”
UK prime minister Rishi Sunak said: “Tata Group’s decision to build their new gigafactory here in the UK – their first outside of India – is a huge vote of confidence in Britain. This will be one of the largest ever investments in the UK automotive sector.
“It will not only create thousands of skilled jobs for Britons around the country, but it will also strengthen our lead in the global transition to electric vehicles, helping to grow our economy in clean industries of the future.”
Mr Shapps said the investment will bring 4,000 jobs directly and thousands more indirectly, such as in supply chains.
Tata did not mention how many jobs it expects to create.
“It is a big deal. It is probably the biggest ever UK car investment – or certainly the biggest for 40 years,” Mr Shapps told Sky News.
“This will produce a gigafactory that can produce about half the UK’s electric vehicles batteries.
“It has been nine months in negotiations, I’ve been involved with it throughout, including going to India.”
Earlier this year, start-up Britishvolt went out of business. Despite having little experience in the sector, it had promised to build the UK’s first gigafactory.
But in the end it could not raise enough money to push ahead with the plans.
Vauxhall maker Stellantis said in May that it would struggle to make electric cars in the UK without changes to the Brexit deal.
It said it is vital to “reinforce the competitiveness of the UK by establishing battery production”.
West of England Labour mayor Dan Norris said: “After so many false starts, this is fantastic news for the West of England.
“Local workers are delighted to see 9,000 new green jobs wrapped up in a Union flag. It shows our region is leading the way as the best place to invest in net zero.
“Given the scale of the investment, we have a real opportunity to shape the green jobs revolution, not just here in the West, but nationally and internationally, to ensure these jobs of the future are high-quality, well-paid and unionised.
“However, the lack of a coherent industrial strategy means this historically rail-connected site will only be accessible by road. That’s a mistake.”
