It has been revealed that a Chinese company, which makes batteries for BMW electric vehicles, is about to invest billions of pounds in the construction of Britain’s largest gigafactory.
EVE Energy is the largest producer of cylindrical Tesla-like car batteries in the world. It’s believed that the company has advanced negotiations for the construction of a 60 gigawatt hour factory on the outskirts Coventry.
Sources close to the negotiations claim that the company will invest at least £1.2billion in a gigafactory of 20GWh. The site will be expanded to 60GWh in subsequent phases, making it nearly twice as large as Nissan’s electric battery factory located in Sunderland.
The West Midlands Gigafactory will be the anchor tenant of a bigger project called the UK Centre of Electrification. This is a joint venture of local councils with the owners of Coventry Airport, where the work will be built.
The plant will create 6,000 direct jobs, and thousands of additional jobs in the supply chain. This is in a region which exports cars and auto components worth an estimated £14billion — nearly double the amount of any other area of the UK.
EVE is said to be one of the five largest EV battery makers in the world. It was reported that EVE made “a multibillion pound promise” in a letter sent to Jeremy Hunt. Sources said that months of closely guarded discussions involving officials from the local and central governments have taken place.
Sources familiar with the situation claim that talks are at an “exclusive, advanced stage” and a contract could be signed in “a few weeks”. Negotiations are in a delicate position. The investment is dependent on the UK providing hundreds of millions in subsidies. This money will likely come from £4.5 billion of aid to key manufacturing sectors such as automotive.
The Conservatives would benefit from a deal, especially as the battery maker chose the UK over the EU and the US where the Biden Administration is offering incentives to green technologies through the White House Inflation Reduction Act.
Andy Street, the mayor of West Midlands is believed to have played an important role in brokering discussions between the joint venture EVE and chancellor. A deal would be a huge boon to the former boss of John Lewis who is standing for reelection in may.
EVE signed a deal 18 months ago with BMW to supply large cylindrical batteries in Europe for their electric cars. The Guangdong-headquartered company began construction of its first gigafactory in Europe in Debrecen, Hungary, in November.
EVE is believed to have a customer or clients lined up for its UK-made battery. This weekend, the name of the manufacturer remained a secret. BMW, the company that will produce electric Minis in its Oxford plant, declined to comment.
“We’re determined to make the UK one of the top locations in the World for Automotive Manufacturing as we transition to Electric Vehicles. We also want to make sure taxpayers money is spent responsibly and efficiently.” We don’t comment on speculation, or the commercial affairs private companies.”
The gigafactory includes a recycling facility, which will allow car batteries to be recycled to power household appliances.
According to sources familiar with the matter, a separate agreement had been reached between the joint venture company and National Grid for the provision of electricity. The gigafactory also falls within the West Midlands Investment Zone which offers significant tax incentives, including 100 percent business rates relief, zero employer national insurance contributions and stamp duty exemption for three years.
China’s increasing influence over a strategic asset in the UK will cause new concerns about its influence. Experts claim that China can remotely control EVs using its technology to bring cars to a halt.
Nissan runs the UK’s only car gigafactory, in partnership with Chinese EV batteries specialist Envision. Tata Group will build a Battery Factory in Somerset that will power Jaguar Land Rover Vehicles. The Somerset site’s backers said that pre-construction has already begun. Full construction will begin later this year, and the facility is aiming to start battery production by 2026. Envision is also linked to the JLR location. The West Midlands megafactory has already been granted planning permission.
The other parties refused to comment.