Tesla Inc (NASDAQ:TSLA) may be joined by fellow carmakers in plans to build battery “gigafactories” in the UK as the government is helping the sector.
Britain has allocated £500mln for such ventures, competing with a piece of an EU fund worth €2.7bn (£2.3bn).
Ford and Nissan, alongside South Korean giants LG and Samsung and startups BritishVolt and InoBat, are discussing with Westminster over potential sites.
Ford is to launch its electric van Transit Custom, which will be produced in Turkey, in 2023.
The government told the Financial Times that it is “dedicated to securing gigafactories, and continue[s] to work closely with investors and vehicle manufacturers to progress plans to mass-produce batteries in the UK”.
Earlier this year it was revealed that Tesla has government support to construct a huge ‘Gigafactory’ in southwest England to build electric cars and batteries.
To guarantee the UK can manufacture cars in the electric era, there needs to be a step up in investment in all aspects of the car making supply chain, especially batteries, experts say.
But last year, Tesla chose a site near Berlin in Germany to locate its first European factory, instead of a proposed location in north-east England, citing “Brexit uncertainty”.
According to green group Transport and Environment (T&E), the UK could fall behind other countries as it is forecast to produce just 4% of the electric cars made in Europe by 2030.
In 2018 it accounted for 50% of all production, but UK car producers are among the least prepared.
“The UK will be among the first countries in Europe to end the sale of new cars with a combustion engine, but these will be overwhelmingly imported without companies investing here,” said T&E UK Director of Transport and Environment, Greg Archer.
“UK car industry dinosaurs will be extinct within a decade unless they invest in new battery manufacturing and convert existing production to electric models.”