The UK government on Wednesday announced that the Tata Group is to invest over 4 billion pounds in setting up a new electric vehicle (EV) battery plant, or gigafactory, in Britain which will create thousands of jobs across the supply chain.

British Prime Minister Rishi Sunak hailed it as an “incredibly proud” moment for the country’s automotive industry and described it as a testament to the strength of the UK car manufacturing industry and its skilled workers.

Tata Motors owns UK-based luxury carmaker Jaguar Land Rover (JLR), which will be the anchor customer of the new gigafactory with an initial output of 40GWh – making it one of the largest in Europe.

Production at the new gigafactory is due to start in 2026 and is pitched as a key driver behind Sunak's priority to grow the UK economy.

“Tata Group’s multi-billion-pound investment in a new battery factory in the UK is a testament to the strength of our car manufacturing industry and its skilled workers,” said Sunak.

“With the global transition to zero-emission vehicles well underway, this will help grow our economy by driving forward our lead in battery technology whilst creating as many as 4,000 jobs, and thousands more in the supply chain," he said.

"We can be incredibly proud that Britain has been chosen as home to Tata Group’s first gigafactory outside India, securing our place as one of the most attractive places to build electric vehicles,” the British prime minister said.

As one of the largest-ever investments in the UK auto industry, the new factory will create up to 4,000 highly skilled jobs as well as thousands of further jobs in the wider supply chain for battery materials and critical raw minerals.

The gigafactory will secure UK-produced batteries for JLR as well as other manufacturers in the UK and Europe. The location of the new gigafactory is expected to be in Somerset, south west England.

“Our multi-billion-pound investment will bring state-of-the-art technology to the country, helping to power the automotive sector’s transition to electric mobility, anchored by our own business, JLR," said N Chandrasekaran, Chairman of parent company Tata Sons.

"With this strategic investment, the Tata Group further strengthens its commitment to the UK, alongside our many companies operating here across technology, consumer, hospitality, steel, chemicals, and automotive,” Chandrasekaran said.

The Department for Business and Trade (DBT) said details of the government’s incentives and support provided to the Tata Group as part of the agreement will be published in due course as part of regular transparency data.

However, reports in the lead-up to the announcement had indicated subsidies in the form of grants, energy subsidies and other training and research funding would be part of the agreed package.

“Today’s multibillion-pound investment demonstrates that this government has got the right plan when it comes to the automotive sector," noted UK Business and Trade Secretary Kemi Badenoch.

"We are backing the UK car industry to help grow our economy as we transition to electric vehicles, and this latest investment will secure thousands of highly-skilled jobs across the country,” Badenoch said.

The investment of over 4 billion pounds is seen as a historic moment for the UK’s growing electric vehicles (EV) industry, with JLR’s suite of Range Rover, Defender, Discovery and Jaguar brands as the key customers.

The Tata investment is described as crucial to boosting the UK’s battery manufacturing capacity needed to support the electric vehicle industry in the long term and the new plant will cover almost half of the battery production that the Faraday Institution estimates the country will need by 2030.

“This is a huge vote of confidence in the UK and one that will drive growth in our economy, creating thousands of jobs and powering our transition to electric cars," said UK Chancellor Jeremy Hunt.

"Tata Group’s gigafactory builds on the strength of our manufacturing industry and shows we’re on the right track, backing the sectors that will underpin our future prosperity for decades to come,” he said.

DBT said the government is committed to making the UK one of the best places in the world for automotive investment, as evidenced by the Automotive Transformation Fund (ATF), the British Industry Supercharger supporting industry energy needs, and the strong programme of support for research and development.

“This new gigafactory puts us firmly in the fast lane to becoming the capital of Europe's electric car market, and makes crystal clear how they see the UK as the place to be for their future growth," added UK Energy Security Secretary Grant Shapps.

"With thousands of jobs on-site and in the supply chain, this new factory will be the cornerstone of our automotive industry, backing manufacturers to develop and expand, and customers to make the switch from petrol and diesel,” he said.

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