Britain is locked in a battle to hold on to production of Jaguar Land Rover’s future range of electric vehicles as concerns grow that the UK is falling behind in the race to build vital large-scale battery factories.
The company, which is owned by the Indian conglomerate Tata, said it continued to “explore all options” for battery supply amid reports it could build electric cars in eastern Europe.
Bloomberg reported that JLR was considering buying batteries from Sweden’s Northvolt AB or China’s SVOLT Energy Technology for a range of electric cars that it may assemble in Slovakia.
The firm is also in talks with the UK government over funding for the construction of a battery plant, or “gigafactory”, to ensure a local source of batteries.
This follows JLR’s commitment last year to make the Jaguar brand electric-only by 2025, as well as a pledge to abandon petrol vehicles entirely in the next decade. It currently has just one pure electric model, the I-Pace, built in Austria.
The company said it would “retain our plant and assembly facilities in the home UK market and around the world” as part of its strategy. “We continue to explore all options around the supply of batteries. No decisions have been made yet,” a spokesperson said.
As part of JLR’s switch to electric, the company – which employs 30,000 people in the UK – has previously said it would keep all of its main factories located in the West Midlands.
The firm also has manufacturing sites in Slovakia and Austria and other facilities in Brazil and Asia.
Battery factories are seen as crucial for the future prospects of the UK automotive industry as it moves away from the production of international combustion engine vehicles.
The global battery supply has been dominated by Asian manufacturers – especially in China, Japan and South Korea – although Europe and the US have been racing to catch up.
Batteries are by some margin the most expensive part of an electric vehicle, but until now the development of UK factories has been sluggish.
China’s Envision is expanding a plant in Sunderland next to Nissan’s car factory, and the UK startup Britishvolt has been raising funds for a gigafactory near Blyth, Northumberland.
The UK government announced a £100m investment in Britishvolt at the start of the year as part of its automotive transformation fund. It has also held talks with six car manufacturers about building gigafactories.
Attracting other investment has proved difficult in recent years, which Mike Hawes, the chief executive of the Society of Motor Manufacturers and Traders (SMMT), said was not helped by Brexit.
“Europe is playing catchup with Asia,” he said. “The uncertainty of Brexit and what was going to happen for five years made the UK very difficult to invest in because by definition you didn’t know what the trading conditions were going to be so you didn’t know what the longevity of the viability of manufacturing was going to be.”
Trade unions are concerned that the slow development of battery plants in the UK could move car industry jobs abroad.
Des Quinn, a Unite national officer, said: “The government needs to wake up and smell the coffee about the fact that without new gigafactories and a supply chain for electric vehicles there’s going to be mass unemployment and economic damage from 2028 onwards.”
A spokesperson at the Department for Business, Energy and Industrial Strategy declined to comment on reports about JLR’s plans, but said it regularly speaks to companies in the industry.
They added: “The UK continues to be one of the best locations in the world for automotive manufacturing thanks to a major investment programme to electrify our supply chain, create jobs and secure a competitive future for the sector.”
