In a groundbreaking move for the United Kingdom’s automotive industry, Tata Group, the Indian multinational conglomerate and owner of Jaguar Land Rover, will be announcing plans to erect its prominent electric car battery manufacturing facility in Somerset, UK.
This highly anticipated announcement, expected to be made officially on Wednesday, follows a decision by the UK government to financially back the project with subsidies worth hundreds of millions of pounds, according to informed sources.
The new facility is projected to have a transformative impact on the UK car manufacturing sector, creating up to 9,000 jobs in the region around Bridgwater, Somerset, and significantly supporting the industry’s transition from fossil fuel to electric vehicles. As batteries constitute over half of an electric vehicle’s value, the plant’s operation is considered crucial for the future of the UK’s auto industry.
This landmark investment is hailed as the most significant in UK’s automotive sector since Nissan’s arrival in the 1980s. Furthermore, it could potentially pave the way for additional battery investments in the country, which currently only hosts one operational battery plant next to Nissan’s Sunderland factory and a nascent project in Northumberland.
Amid criticism for the lack of a clear industrial strategy and falling behind the US and EU in fostering low-carbon technologies, the UK government’s investment in Tata’s battery plant signals a robust response. However, critics argue that the government’s recent five-year programme falls short of providing the necessary funding and legislation to meet the country’s ambitious net zero goals, including phasing out new petrol and diesel cars by 2030.
The Somerset factory will be instrumental in supplying batteries for the forthcoming electric models of Jaguar and Land Rover. Tata’s decision to establish the factory in the UK, over a competing site in Spain, is likely to be seen as a significant victory for Britain by the government.
The undisclosed size of the subsidy package to Tata has sparked conversations, however, with critics pointing out the need for a comprehensive strategy that supports the entire electric vehicle sector. The FairCharge group, representing other players in the EV sector, voiced concerns over Tata’s investment potentially consuming the entirety of the government’s available support.
Andy Palmer, ex-executive at Nissan and Aston Martin, and now at EV charging firm Pod Point, argued that the UK needed a holistic industrial strategy to “lift all boats”. He commented, “Support must come in all shapes and sizes for businesses of all shapes and sizes. One gigafactory doesn’t equal success, it equals part of the puzzle.”
Apart from Jaguar Land Rover, Tata Group has substantial steel interests in the UK, including the Port Talbot plant in South Wales. An additional £300 million is expected from the government to subsidise, upgrade, and decarbonise these operations.
While the UK government has refrained from commenting on ongoing negotiations with private companies, Parliament’s cross-party Business and Trade Committee has started an inquiry into the UK’s electric vehicle battery manufacturing sector.
Whether the scale of government support for Tata’s project will prove to be a sustainable model for the broader UK EV industry remains to be seen.