Jaguar Land Rover's recent calls for a UK ‘gigafactory’ to ease the transition to electrification for the struggling car industry appear more relevant than ever, as plans for a new range of electric cars at its Castle Bromwich plant are revealed.
The automotive industry’s future is electric, that’s if Jaguar Land Rover’s announcement of a multi-million-pound investment to build a range of electric vehicles at its Castle Bromwich plant is anything to go by.
The plant will produce an electric version of the luxury Jaguar XJ, in a development that – JLR claims – will help secure 2,700 jobs at the Midlands plant. The firm has pledged to offer customers electrified options for all new models from next year.
Automotive manufacturers like JLR are investing in technology to lead the charge for electric vehicles. Most recently, JLR and BMW joined forces to share their electrification expertise and develop the cars of the future.
It comes as no surprise that JLR is looking to find growth in the electric vehicle (EV) market as it’s had a tough time of late. It cut 4,500 jobs at the start of the year and was hit with a £3.6bn annual loss last year – the biggest in the firm’s history.
In January of this year, JLR confirmed plans to bring battery and Electric Drive Unit (EDU) assembly to the Midlands, with the 150,000 unit capacity assembly centre at Hams Hall operational by 2020.
“We are co-locating our electric vehicle manufacture, Electronic Drive Units and battery assembly to create a powerhouse of electrification in the Midlands,” said Ralf Speth, CEO of Jaguar Land Rover, back at the start of the year.
To make an electric future for the car industry a reality, JLR has called for a shared UK ‘gigafactory’ to be built for car makers. This follows reports that ministers are considering backing a £1.7bn gigafactory, which could be the UK’s answer to Tesla’s gigafactory in the Nevada desert.
A report by the Faraday Institution claims that without any major gigafactories, 114,000 automotive industry jobs would be lost by 2040. But with the right strategy, the UK could become a world leader in the production of batteries and EVs, with a potential 60,000 additional employees in the industry by 2040, taking the UK automotive workforce to 246,000 people.
However, considerable growth in the UK battery manufacture sector is needed. In the next 20 years the report explains that between four and 13 high-volume, battery production plants (or gigafactories) will be needed if the UK is to have a flourishing – or even sustainable – automotive industry.
UK must build batteries
Car manufacturers need to be near battery facilities for cost and regulatory reasons. “Electric car batteries are difficult things to transport,” Stephen Gifford, Head of Economics and Market Insight at The Faraday Institution tells me.
“What we estimate is that without battery manufacturing in the UK, the automotive industry will slowly decline over time, and we must avoid that at all costs,” he adds.
Gifford says that the UK has a good chance of being a leader in the manufacture of EVs if it gets battery making right: “There are a number of reasons that would attract battery manufacturers to the UK. We already have a leading car industry, for example, so proximity to car manufacturers is perhaps the biggest one.”
A positive development
“The car industry is being disrupted by this new technology and if it doesn’t respond, it will suffer as a result. There is a massive opportunity but also a massive risk. We have the potential to be leaders, but we must act now,” he adds.
Paul Faulkner, chief executive at Greater Birmingham Chambers of Commerce, via Twitter, said: “Packed house at Castle Bromwich to hear Jaguar Land Rover CEO Ralf Speth outline the electric future for the firm, the company’s commitment to manufacturing in the West Midlands and the support required from government to ensure the full potential is realised.”
Meanwhile, UK’s largest union, Unite, says JLR’s confirmation that it will build new electric models at its Castle Bromwich plant is a ‘fantastic boost’ to the car industry.
The Faraday Institution is the UK’s independent national battery research institute, and it was established in 2017 as part of the government’s £246m investment in battery technology through the Industrial Strategy.