Britishvolt has collapsed into administration, in a hammer blow to Britain’s hopes of building its own electric vehicle industry, after last-ditch rescue talks collapsed with several investors.
The moves made the majority of its 300 staff redundant, with the battery start-up filing for administration after its board ultimately decided there were no viable bids to keep the company afloat.
The future of Britishvolt has been in doubt for months, after it failed to secure further Government funds last October to build its £3.8bn gigafactory in Northumberland.
It had asked to for an advance of £30m on the promised £100m in support offered by the Government, but Downing Street refused because the company had failed to hit necessary construction milestones for the factory.
Shadow business secretary Jonathan Reynolds laid the blame at the Government’s door, dismissing its industrial strategy as a “failure”.
He said on Twitter: “The Government’s failure on industrial strategy means we’re losing the global race for electric vehicle battery manufacturing, putting our world-famous car industry at risk. Local communities face watching businesses shut their doors, jobs going abroad and investment leaving Britain.”
This outlook was shared by BEIS Select Committee chair Darren Jones – who is also a Labour MP.
He said: “If we’re going to keep making cars in the UK, we need to also make electric vehicle batteries. The demise of British Volt today has show this is a pre-commercial industry that needs more support from the Government.”
What does this mean for the UK?
Britishvolt’s collapse reflects a sharp fall in grace for the company, which was set up in 2019 to deliver a gigafactory site and sustainable low-carbon batteries to the UK’s motor industry.
When the Government was in talks over funding for the gigafactory last July, former Business Secretary Kwasi Kwarteng argued the site would “turbocharge” the UK’s plans to “embed a globally competitive electric vehicle supply chain in the UK.”
He said it was “fantastic to see how the project is progressing.”
The battery start-up’s decline is also a huge setback for the UK’s aspirations to manufacture electric vehicles across the country, as the site was intended to be a flagship hub for British manufacturing.
It also comes after BMW announced plans last October that it will end production of the electric Mini in Oxford in 2023 and relocate manufacturing overseas.
The UK currently only has one Chinese-owned plant next to the Nissan factory in Sunderland, while 35 plants are planned or under construction within the European Union.
Michael Naylor, managing director of battery material specialist EV Metals, was saddened by Britishvolt’s collapse.
He told City A.M.: “It is disappointing to see a quality company such as Britishvolt fail. It has suffered from the UK electric vehicle supply chain being disconnected and underinvested.
“It shows that government and private capital need to work together to integrate supply chain if the UK car industry is to be protected and have a key role in the transition to electric vehicles.”
EY has been appointed joint administrators of Britishvolt, and will now implement a closure and winding down of the company’s affairs.
It will also listen to bids for Britishvolt’s business and assets.
The administrator described the gloomy developments as “disappointing,” attributing its fall into administration to a lack of sufficient equity investment for both the ongoing research it was undertaking, alongside the development of its sites in the Midlands and the North East of England.
The Government has been approached for comment.