A new £1bn electric vehicle battery gigafactory will be built in northeast England by Nissan and its China-owned partner, supported by subsidies from the UK government.
The 'EV36Zero' electric vehicle hub will be located in Sunderland, with a 9GW battery gigafactory owned by Chinese-owned partner Envision AESC nearby the Japanese group’s existing car plant in the city.
Nissan will invest £423mln into the new hub and Envision AESC, which owns and operates an existing battery production in Sunderland for the Nissan LEAF, will invest £450mln.
The size of the UK government grant was not revealed.
Planning permission has been given the nod by Sunderland City Council for an initial 9GWh plant, with potential future investment of £1.8bn by Envision AESC by 2030 dependent on demand, and potential on-site for up to 35GWh.
The new plant will increase the cost-competitiveness of EV batteries produced in the UK, Nissan said, including through a new Gen5 battery cell with 30% more energy density which improves range and efficiency.
“This commitment will power Nissan's new vehicles, supporting the continued localisation of vehicle parts and components with advanced technology. This will make batteries cheaper and EVs more accessible to a growing number of customers in the future,” it added.
As part of the £1bn announcement, Nissan said it is building on the success of its LEAF electric car with a “next-generation” crossover EV produced in the UK and exported to Europe, with a forecasted production capacity of up to 100,000 units to be installed. No date was given for the new car's launch.
Production of the new car in Sunderland will create 909 new jobs at the plant, and more than 4,500 in the UK supply chain, while safeguarding a further 75 R&D jobs, the Japanese company said.
The new gigafactory will create 750 jobs and safeguard the jobs of 300 current employees.
Business secretary Kwasi Kwarteng said: "The cars made in this plant, using batteries made just down the road at the UK's first at scale gigafactory, will have a huge role to play as we transition away from petrol and diesel cars and kick-start a domestic electric vehicle manufacturing base."
To keep pace with the green industrial revolution and secure the long-term future of the UK automotive sector, another six giga-factories are needed across the country over the next few years, trade union Unite said.
Steve Turner, Unite assistant general secretary for manufacturing, said: "I urge the government not to rest on its laurels. Ministers must say more today about when these sites will be forthcoming. No loose promises for the future. Our economy and UK manufacturing demands investment now in the technologies of the future. Germany, for example, is not waiting around - its government is already investing over €1 billion in the construction of facilities to support its automotive heartlands."
20 miles away, there is another proposed site for a battery gigafactory that is being developed by startup Britishvolt, pending investment.
In December, Britishvolt unveiled plans to build the £2.6bn plant on the site of the old Blyth Power Station in Northumberland, with an intention to break ground this summer and begin production of lithium-ion batteries within three years.
It said last month that it “remains on-track” to start production of batteries for automotive applications by the end of 2023, supported by R&D from Durham, Newcastle and Northumbria universities.
Last month that it has been selected as the lead supplier in a new government-funded project focused on bringing two AMTE Power lithium-ion batteries to readiness for the automotive market.