Tata To Build £4 Bln Battery Plant In The UK Bolstering The Country's Auto Industry

Tata, the Indian conglomerate, has announced plans invest 4 billion pounds or $5.2 billion to construct a battery plant in western England, a move welcomed by the auto industry and lawmakers who seek to prevent car manufacturers from leaving the country.

The battery plant will support Tata’s subsidiary, Jaguar Land Rover, and has the potential to produce nearly half of the electric car batteries required by the UK by 2030. The government, in a bid to secure the investment, offered substantial subsidies for the project and expects it to create 4,000 jobs.

The decision to build the battery plant domestically is crucial as it eliminates the need for carmakers to import batteries and face high tariffs imposed by the European Union or bear the costs of transporting the equipment. Previously, Nissan’s battery facility in northeast England was the only other battery plant in the country. Tata was considering constructing the battery plant in Spain, but this option would have disadvantaged Jaguar Land Rover’s vehicles produced in Britain. The anticipated location for the plant is Somerset, in western England.

Jaguar Land Rover, the second-largest automaker in the UK after Nissan, manufactured nearly 203,000 vehicles in Britain last year. However, overall car production in the country has declined significantly, dropping from a peak of over 1.7 million in 2016 to 775,000 in 2020. The British car industry is facing challenges due to the shift towards electric vehicles and the consequences of Brexit. Despite the decline, the sector remains significant for the UK economy, employing 182,000 people.

In the race to attract battery manufacturers, Britain is competing against the United States and the European Union, both of which offer substantial subsidies to battery makers.

Tata already has significant investments in various businesses in Britain, including Jaguar Land Rover and steel operations. The company has been engaged in discussions with the government regarding financial aid to transition its steel plant in Wales to produce steel with fewer carbon emissions. Tata’s decision to invest in the battery plant reinforces its commitment to the UK, according to Natarajan Chandrasekaran, Tata’s chairman.

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