Tata’s battery investment in UK a ‘major’ move

Some in the car industry have lauded the plant as the most significant investment in British automotive since Nissan came to Britain in the 1980s.

Although the deal has yet to be signed, sources familiar with the matter say that engagement has moved from negotiations to drafting and choreography of how the landmark agreement will be presented.

Tata was considering another site in Spain and the expected decision to choose Somerset will be presented as a major achievement for the UK government.

Last week, Stellantis, one of the world's biggest carmakers, warned it might have to close British factories if the government doesn't renegotiate the Brexit deal. The firm, which owns Fiat, Peugeot, Citroen and Vauxhall, had committed to making electric cars in the UK, but said this was under threat.

The government has said that although it does not acknowledge a figure of 500 m in reported subsidies, it is in the hundreds of millions of pounds.

Tata has significant steel interests in Britain, including the Port Talbot plant in South Wales, and the government will also offer around 300m to subsidise, upgrade, and decarbonise those operations.

The government conceded that although the two investments will not be announced at the same time, the two projects are linked.

Although the price tag will be seen as substantial, the UK is cautiously involved in an international subsidy war, which has been significantly escalated by the US Inflation Reduction Act, a legislation offering $370 bn 299 bn in sweeteners to companies prepared to locate production and supply chains in the US.

Some industry insiders believe that Tata's battery investment will open the door to further battery investments in the UK, which currently has one plant in operation next to Nissan's Sunderland factory and one barely on the drawing board in Northumberland.