Britishvolt collapses into administration: what happened to EV battery firm - and UK gigafactory plan impact

Experts warn collapse of Northumberland gigafactory project threatens UK’s green transport ambition

EV battery firm Britishvolt has gone into administration with the loss of almost 300 jobs.

The British-based start-up, which planned to open a massive battery production facility in Northumberland, called in administrators after failing to secure private investment for the £4 billion project. The announcement came after months of trouble as the company struggled to raise enough money to stay afloat.

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It fell into emergency funding talks in November before securing tens of millions of pounds of financial backing from metals giant Glencore. A week ago the group said it was in talks with a consortium of investors to purchase a majority stake and secure its future but, in a major blow to the UK car industry, administrators confirmed that no viable offers had been made.

The start-up’s plans aimed to capitalise on political ambitions to make the UK a world leader in EV development. They included a £3.8 billion “gigafactory” in the Blyth Valley, Northumberland, building batteries for electric vehicles, and a battery development centre. The site was projected to produce batteries for up to 300,000 EVs per year and employ up to 3,000 people when fully operational.

Industry experts said the failure of the plans were a major setback to the UK’s ambition to be a leader in EV technology and warned problems facing the country’s car industry could get worse without a nationwide green transport strategy.

Figures from the SMMT show that electric car production rose in the UK during 2022 but Jim Holder, editorial director of What Car?, warned that without major investment in projects like the Britishvolt plant the country could not compete as manufacturers move to all-electric ranges.

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He said: “Britishvolt’s facility was set to cost £4bn to build and take years to be competed, yet the truth is we need at least five such facilities by the turn of the decade to remain a competitive country to build electric cars in.

“Today’s news is very bad news for the whole industry - and the only positive will come if it spurs Government into action to secure a partnership between itself, the industry and battery manufacturers that can succeed into the long-term."

The UK is currently home to only one EV battery plant - a Chinese-owned facility next to the Nissan plant in Sunderland where the all-electric Leaf is built. Only two mainstream EVs are currently built in the UK - the Leaf and the Mini Electric.

Ben Nelmes, chief executive of motoring consultancy New AutoMotive, said the news could be the tip of the iceberg without more solid plans to support the development of the EV technology sector.

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He commented: “The news that Britishvolt is filing for administration is deeply disappointing, and a blow to the UK’s transition to cleaner, cheaper transport. Delays to the government’s Zero Emissions Vehicle (ZEV) mandate have created additional uncertainty around rates of EV uptake and future demand for EV batteries.”

“The UK urgently needs a green industrial strategy to prevent the trickle of bad news about the UK car industry turning into a torrent in a few years’ time.”

Ian Levy, Tory MP for Blyth Valley, said he would continue to ask the government to support the Northumberland Britishvolt site. He said: “Our area needs this investment and the jobs that will bring, and I will be asking the government to stand by the offer of financial support from the Automotive Transformation Fund for any consortium able to put together a full package.”

The project had secured a commitment of £100 million from the £850m Automotive Transformation Fund but it was dependent on it meeting certain milestones, which it failed to do.

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Kevin Hollinrake, a business minister, said: “It’s important to note that we have not withdrawn any money from Britishvolt but clearly taxpayers money is important. It’s important that we dispense that money in a responsible way.

“There were clear milestones we expect anybody who’s received public money to hit and we are looking at the situation very carefully to make sure they are.”

Jonathan Reynolds, Labour’s shadow business secretary, said: “The Government’s long-term failure on industrial strategy means we’re losing the global race for electric vehicle battery manufacturing, putting our world-famous car industry at risk.”

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