Indian owner of Jaguar Land Rover threatens to move electric car production to Slovakia if ministers refuse to support taxpayers for a UK giant factory.
Tata Motors has held talks with foreign battery makers Northvolt and SVolt Energy Technology amid a stalemate over state support for a plant in the UK, which is key to its plans to be fully electric by 2025.
The company has previously announced that new power models will be built at existing factories in the Midlands and is understood to be in advanced negotiations to build a gigabyte plant near Bristol or Redcar.
Many of JLR’s 30,000 jobs in the UK could be at risk if you opt for Slovakia.
Government sources suggested the proposals were a bargaining tactic. A privileged person said: “They are using this as a way to extract more money from the government.”
Tata has been in talks with ministers for several months as he finalizes his decision to build a new plant to supply JLR’s electric vehicle fleet, reducing the locations of the sites to a list of two.
The Daily Telegraph may reveal that Gravity Business Park near Bristol, the location the UK hoped to convince Jeff Bezos-backed electric truck maker Rivian to set up a £ 1bn factory, will compete against Teesworks site on Redcar.
The final decision is due in late June, industry sources said.
A spokesman for JLR said: “With our strategy for every Jaguar Land Rover model available as a [battery electric vehicle] by the end of the decade, we continue to explore all the options around battery supply. No decisions have been made yet. “
Tata’s threats will draw parallels with Nissan’s tough negotiations with the government in late 2016. The Japanese carmaker has managed to raise £ 80m in aid to taxpayers in exchange for committing to the carmaker more Great Britain in Sunderland, four months after the Brexit vote.
Boris Johnson promised to build a new highway junction and revive old rail links to lure Rivian to the 635-acre Gravity Business Park.
The Prime Minister then said: “The UK innovation scene is thriving because of the steps my government has taken to invest in the electrification of the automotive industry backed by my personal commitment to the industry. “.
In March, it was learned that Jaguar Land Rover had begun talks with the battery manufacturer supplied by Nissan about the production of power supplies for its Land Rover and Range Rover models.
Envision AESC, which has its roots as a joint venture between Nissan and the Japanese conglomerates NEC and Tokin, is already planning a new battery plant for the Japanese carmaker Sunderland.
However, the size of a possible deal with Jaguar Land Rover, Britain’s largest carmaker, would require a second battery factory, experts say.
If the JLR / Envision battery factory goes ahead, it is expected to be on the site of a former Redcar refinery in Teesside, which has access to renewable energy sources as well as space.
JLR, which along with Nissan accounts for the majority of UK-made cars, is lagging behind its main rivals when it comes to choosing a battery supplier.
The company is also suffering more than its competitors from the enduring crisis of computer chips.
Earlier this month, JLR said the supply disruption resulting from the coronavirus blockade in China could extend its streak of money losses for another three months, as it reported losses last year.
The shortage of computer chips and higher costs pushed it to a pre-tax loss of £ 412 million for the year to the end of March, compared to a profit of £ 662 from the previous 12 months, after that their operations were “significantly affected by the limitation of production.” and global chip shortages. “
Chinese blockades have shut down factories that produce computer chips and disrupted ports that ship these and many other parts.
But while other European carmakers have had record profits, taking advantage of computer chips that can be found far from mass-market models to more profitable vehicles often at the fancy end of the market, JLR has failed to do so. to the same degree.
Despite these setbacks, customers continue to place orders. The carmaker has a record order book of 168,000 cars, which will take about five months to meet last year’s manufacturing tariffs.
The company said two out of three cars it sells now run on batteries or hybrids, compared to 51 units a year ago.
He was charged £ 43 million in his business in Russia, where he has a sales operation. JLR, which sold 6,900 cars in the country last year, suspended exports to Russia in March.