8:25 am, May 22, 2023
The British car industry could be set for a major boost with Tata Motors close to agreeing a deal to build a new gigafactory in the UK.
The Financial Times reports that the government is ‘increasingly hopeful’ of enticing the Asian outfit to build a flagship battery plant here, rather than in Spain.
It is reported that several incentives, worth hundreds of millions of pounds, have been put in place to facilitate the deal going through.
The agreement would be a significant coup for EV battery production in Britain, amid fears the UK had ‘missed the boat’ when it came to to building gigafactories.
The proposed new plant would be built in Somerset and supply batteries to JLR, which is owned by Tata Motors.
Although no decision has been agreed, it is hoped an announcement could come as early as this week.
The Indian outfit had been asking for financial assistance to the tune of £500m to build the new plant in Bridgewater.
According to the FT, the UK has offered a one-off grant from the £1bn automotive transformation fund as well as another to improve road access to the proposed site, which is a stones’ throw from the M5.
Bosses had been thought to be heavily favouring Spain but it appears a last minute deal has been struck, following talks with energy secretary Kemi Badenoch.
However, concerns do remain about high energy prices in the UK compared to rivals within the EU.
A source close to the deal said: ‘The fundamental sticking point is not about the cost of the build, we have got to parity on that, it’s all about the operational costs and the high cost of energy in the UK versus other markets.’
Tata declined to comment.
