British car industry risks collapse without massive investment in electric cars and batteries

Electric car charging

The report warned that the the UK needs to increase its battery capacity

Felix Reeves

By Felix Reeves

Published: 21/11/2023

- 08:44

Unless change happens, the UK could lose out to the EU, US and China

A new report has warned that car manufacturing in the UK could collapse if the Government and private companies do not promote electric car battery production.

The report, from the cross-party Business and Trade Committee, forecasts that hundreds of thousands of jobs are at risk if the issue is not addressed.

It adds that the UK could become a “frontrunner” in building “sustainable and ethical batteries”, highlighting how most of the world’s gigafactories are in China.

Experts have estimated that the UK will require 100 gigawatt hours of battery manufacturing capacity by the end of the decade.

WATCH NOW: Labour's Steve Reed reacts to electric car changes

This would satisfy demand for the automotive industry and other sectors, with the requirement rising to 200GWh by 2040.

However, the UK’s only existing gigafactory near Nissan’s manufacturing plant in Sunderland has less than 2GWh of capacity.

The report states: “At best, announced plans satisfy a little over half the capacity the nation needs by 2030.”

In July 2021, Nissan announced a £1billion funding boost to build a new gigafactory that will enable its Sunderland car plant to increase production of EVs.

The Japanese manufacturer estimated that 900 jobs would be created, in addition to 750 jobs at Chinese production company Envision.

According to the Government, the Advanced Manufacturing Plan and the Battery Strategy will be published later this week.

Labour MP Liam Byrne, chair of the Business and Trade Committee, said: “Power was at the heart of the industrial revolution, and it will be at the heart of the green industrial revolution.

“But right now, the UK is on course to secure barely half of the electric battery capacity needed by the domestic car industry alone.

“Unless we fix this fast, we risk the industry simply relocating to Europe or the US or becoming reliant on imports from China and elsewhere.

“That imperils 160,000 jobs and a jewel in the UK’s industrial crown. Now is the time to act.”

There had been plans to develop a new gigafactory in Blyth although this collapsed after the firm behind the plan, Britishvolt, entered administration.

A spokesperson for the Department for Business and Trade said: “In the past few months the Government has secured a £4billion investment from Tata in a new gigafactory, and £600million to build the next generation of electric Minis.

“This comes on top of a previous £1billion investment in an Electric Vehicle hub in Sunderland by Nissan and their battery supplier AESC.

“Taken together these major investments demonstrate that our plan for the automotive industry is working and continuing to deliver results.


Nissan's Sunderland plant

Nissan's Sunderland plant saw a huge boost in investment two years ago


“Later this week we will publish a wide-ranging Advanced Manufacturing Plan and the UK’s first Battery Strategy, both of which will ensure we continue to place the UK at the forefront of global supply chains.”

You may like