UK could pay up to £500m in subsidies to support new Jaguar Land Rover battery plant
The UK could pay as much as £500m in subsidies to Tata Group to support its £4bn investment in a new battery plant in Somerset that would supply a new range of electric Jaguar and Land Rover models.
Tata Group – the Indian conglomerate who own Jaguar Land Rover (JLR) – announced yesterday that it would be setting up the plant in the UK, with Prime Minister Rishi Sunak hailing the decision as a “testament to the strength of our car manufacturing industry and its skilled workers.”
Tata had been deciding whether to pick Spain or the UK as the location for the new plant.
The giant 40GWh gigafactory will create 4,000 direct jobs and is a central part of the government’s strategy to boost Britain’s electric car and battery industries.
Following the announcement, Downing Street would not confirm the total cost of the subsidies.
Energy Secretary Grant Shapps would similarly not be drawn. He told Sky News that the “exact numbers on this will come out in the normal way, because of the commercial sensitivities they have to be released in the usual way.”
He added: “It’s not really just money it’s also things like our lead in battery research through the Faraday centre and elsewhere, and those are the things which in the end got Tata convinced to set up the factory here, it was headed elsewhere I should say a few months ago.”
But officials close to the deal said that the total sum, including direct grants from an “automotive transformation fund” and improvements to transport connections could hit half a billion, according to a report in the Financial Times today.
The government was contacted for comment on the report.
Yesterday’s announcement comes just over six months after the failure of Britishvolt, the Northumberland battery plant startup which collapsed in January amid promises of a £100m government grant.