Nissan ‘in talks to build huge UK battery gigafactory’

The deal could create thousands of jobs

Nissan is said to be asking the government (REUTERS)

Nissan is reportedly asking the UK government to help bankroll a new electric vehicle battery “gigafactory” at its Sunderland site.

The Japanese carmaker is understood to be in late-state negotiations for a deal that could create thousands of jobs.

Nissan is asking for tens of millions of pounds in financial support from the UK government for the project to go forward, the Financial Times reported, citing sources close to the talks.

The new factory at the company’s flagship Sunderland site would be run by the company’s Chinese battery supplier Envision AESC.

The new factory could produce 200,000 batteries a year and create thousands of jobs, according to the same newspaper. Nissan reportedly wants the UK to be its main electric hub outside Japan.

It is expected to open in 2024 and would produce 6 gigawatt hours of battery capacity per year, outstripping Nissan’s existing Sunderland plant, which has a capacity of 1.9GWh.

The development follows disappointment in the sector after Tesla chose to construct a plant in Germany rather than the UK two years ago. It is also understood that the government is involved in talks with other potential investors in the field, as the UK tries to ratchet up production of electrical vehicles in order to meet its carbon targets – however, Nissan is the frontrunner.

The Financial Times’ report also states that the deal’s announcement is expected over the summer, after negotiations began following the UK’s Brexit deal with European Union.

The Department of Business, Energy & Industrial Strategy did not comment specifically on the negotiations with Nissan but said it was dedicated to boosting production of electric vehicle batteries in the UK.

A spokesperson for the department said: “We are committed to ensuring the UK continues to be one of the best locations in the world for automotive manufacturing through a major investment programme to electrify our supply chain, create jobs and secure a competitive future for the sector.

“To support the auto sector’s transition to electric vehicles, we are dedicated to securing Gigafactories, and continue to work closely with investors and car manufacturers to progress plans to mass produce batteries in the UK.”

The report follows an announcement from Nissan earlier this year revealing that it will move production of a larger battery for its best-selling Leaf model from the US to the UK in order to the comply with trading rules following the UK’s exit from the bloc.

Demand for electric vehicles is expected to surge this decade as the UK phases of out the sale of new petrol and diesel cars by 2030 and Europe tightening its regulations around CO2 emissions.

Opened in 1986, Nissan’s Sunderland site is the UK’s biggest car plant.

Nissan was contacted for comment.