Tata Group to Build Electric Vehicle Battery Plant in UK

India's Tata will build an electric vehicle battery plant in Britain, the company and the government said on Wednesday, in a major boost for a car industry in need of domestic battery production to help secure its long-term future.

The company said the factory includes an investment of GBP 4 billion (roughly Rs. 32,800 crore). Britain's government declined to immediately detail what support it had provided as part of the deal.

“Tata Group's multi-billion-pound investment in a new battery factory in the UK is testament to the strength of our car manufacturing industry and its skilled workers,” British Prime Minister Rishi Sunak said in the statement.

The government said the factory would create up to 4,000 jobs, with further jobs expected to be created in the supply chain.

There have been months of speculation around where Tata, a conglomerate with interests in software, steel, cars and airlines, would build the factory.

The plant would be a major win for Britain, which is trying to catch up in the global race to build electric vehicle (EV) battery capacity locally – vital for automakers which rely on heavy batteries being built near their car factories.

Britain has expressed concerns at the U.S.'s Inflation Reduction Act, which promises hundreds of billions of dollars of subsidies to green industries, with finance minister Jeremy Hunt saying the government did not have large sums of money for similar measures.

Homegrown battery production will also help British automakers comply with post-Brexit trade rules that will require them to source more electric vehicle components locally in order to avoid tariffs on UK-EU trade from 2024.

The government has previously said it was in talks with the EU over easing those rules, after a warning from car giant Stellantis that it would be forced to shut factories with the loss of thousands of jobs were it to face tariffs.

The BBC said the government would provide subsidies worth hundreds of millions of pounds to Tata.

“The decision by JLR to invest in battery production in the UK is very welcome. We will want to reflect, however, on the subsidy package that was required to secure this decision,” Darren Jones, chair of parliament's business committee, said.

© Thomson Reuters 2023

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