• Monday, May 20, 2024

Business

UK offers £500m package to Jaguar Land Rover to set up battery giga-factory

A logo is pictured outside a Jaguar Land Rover new car show room in Tonbridge, south east England, on May 24, 2020. – Jaguar Land Rover (JLR), owned by India’s Tata Motors, was on Sunday said to be in talks with Britain’s government in the hope of to securing a loan following a drop in sales due to the COVID-19 coronavirus pandemic. (Photo by Ben STANSALL / AFP) (Photo by BEN STANSALL/AFP via Getty Images)

By: Chandrashekar Bhat

BRITAIN’S government has offered incentives worth £500 million to help Jaguar and Land Rover set up a new electric battery “giga-factory”.

Chancellor of Exchequer Jeremy Hunt’s offer comes amid the reports that JLR is weighing up the option of having a giga-factory production facility in Spain as the UK’s largest carmaker is shifting its focus to electric vehicles.

The incentives are seen as an attempt at dissuading the company from offshoring its battery manufacturing and ultimately its car assembly plants.

Last month, JRL unveiled a plan to invest £15 billion over the next five years to transition itself to an “electric-first carmaker” by 2030.

It said its Halewood plant in Merseyside would be transformed into an all-electric production facility and its next-generation medium-size SUV architecture would now be pure-electric.

The Tata Motors-owned company is catching up with its German rivals Mercedes and BMW which have already made strides in the electric vehicle space.

Hunt’s offer of incentives includes a cash grant, reductions in energy costs and covering the cost of upgrading the power network around the site JLR’s parent has identified in Somerset, The Times reported.

The subsidy Hunt put on the table represents half of the government’s automotive transformation fund of £1 billion.

The government is also sweetening the offer by linking it to a further £300 million package for Tata Group to upgrade its Port Talbot steelworks, the report said.

Tata Steel UK had said last year that the future of its steelmaking facility in Britain would depend on how the government supports its decarbonisation efforts.

Germany and other European countries are funding steel companies to upgrade their facilities to achieve decarbonisation goals.

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