The Minister for Industry and Economic Security (Ms Nusrat Ghani)
I am pleased to update the House about the significant investment announced by Tata Group just yesterday. The confirmation that Tata will be investing over £4 billion to build a new gigafactory—the largest in Europe, I believe—in the UK is a historic moment and a major vote of confidence in our automotive sector.
Across Government, we have worked closely with Tata for the past two years to help secure this crucial investment for the UK, and its decision to invest here is a testament to our strong partnership with Tata. Tata’s announcement represents one of the largest investments we have ever seen in the automotive sector, and is part of a new wave of investments—as significant as those made in the 1980s—that are helping to turbocharge our transition to zero-emission vehicles. It will also be the group’s first gigafactory outside India, directly creating up to 4,000 highly skilled new jobs, alongside thousands of further jobs in the wider supply chain for battery materials and critical raw materials.
Tata says that the battery gigafactory will produce high-quality, high-performance, sustainable battery cells and packs for a variety of applications within the mobility and energy sectors. As the anchor customer, the new gigafactory will supply Jaguar Land Rover’s future battery electric models, including in the Range Rover, Defender, Discovery and Jaguar brands. That means we will soon see cars from JLR’s iconic British brands manufactured in the UK, powered by batteries produced in the UK and developed using technology from research and development centres in the UK, before being exported to markets all over the world. Battery production at the new facility will commence in 2026, and we look forward to confirmation of the site’s location once due diligence has been finalised. When operational, Tata expects it to be one of the largest buildings in the UK and plans to maximise its renewable energy mix, with an ambition for 100% clean power.
The investment is also an important reflection of the UK’s position as a key location for European and global automotive manufacturing. With an initial output of 40 GW, the new factory confirmed yesterday will be one of the largest in Europe. As well as being a significant moment for the UK, this investment will play an important part in strengthening economic resilience across Europe in the highly integrated supply chain for the automotive sector and other key sectors. Using the Faraday Institution’s estimates, it will provide almost half of the UK’s required battery production by 2030, boosting the battery manufacturing capacity we need to support the electric vehicle industry in the long term.
The Government are committed to supporting the automotive sector and the electric vehicle supply chain to take full advantage of the move to zero-emission vehicles, and we are putting this commitment into action through the automotive transformation fund, the British industry supercharger and our strong programme of support for research and development. We are working alongside industry to unlock further private investment in our EV supply chain, and we have long-standing and comprehensive programmes of support for the automotive sector, including the ATF, the Advanced Propulsion Centre and, of course, the Faraday battery challenge.
This investment is an important milestone in enabling a UK-made transition to net zero. However, it does not stand in isolation. It builds on other announcements that have been secured with the support of Government, including Nissan and Envision plans to secure £1 billion to create an EV manufacturing hub in Sunderland, Ford committing a total of £380 million to make Halewood the first EV components site in Europe and Stellantis investing £100 million to transition Ellesmere Port to electric van manufacturing.
The transition to zero-emission vehicles gives us a once-in-a-generation opportunity to shape the future of manufacturing. Over 166,000 people are directly employed in the automotive sector, and I am delighted that yesterday’s announcement means that thousands of new highly-skilled jobs will be created in the next few years just for this project alone. This fantastic news from Tata shows that the Government are getting behind business to unlock the barriers to growth and secure further investment, and it will be a real boost to the entire sector. I look forward to building on the momentum and continuing our strong relationship with the sector, so that we can move the UK forward in the race to net zero and support the delivery of the Prime Minister’s priority to grow the economy. I commend this statement to the House.
Madam Deputy Speaker (Dame Eleanor Laing)
Order. I beg the right hon. Gentleman’s forgiveness. I was being distracted by another right hon. Gentleman, who ought to know better, and I therefore did not call the Minister to answer. I do apologise.
Ms Ghani
I think maybe we got a bit noisy as we were trying to fully digest the slightly delusional response of the Opposition Front Bencher, the hon. Member for Stalybridge and Hyde (Jonathan Reynolds), to this statement. Our job as representatives of the automotive sector is to praise, protect and promote, not to play politics, especially with investment this substantial.
Tata’s investment is so substantial. It is 40% of the gigawatts that we need, and fundamentally we need to have 100% by 2030. With Tata and Envision, we are two thirds of the way there. Obviously we want more, but we are not going to be complacent. We should not compare ourselves with the rest of Europe when their needs will be substantially different from ours, but let us take a moment to reflect on what is happening internationally. This is a global race to achieve net zero. Tata has decided to come here to the UK because it has faith in UK workers, UK technology and UK innovation. It has confidence in the UK supply chain, but fundamentally it has confidence in the UK Government’s policy when it comes to advanced manufacturing and the automotive sector.
The hon. Gentleman spoke about the automotive transformation fund, which is a £1 billion fund to support exactly this sort of initiative, but let us just reflect on the bonanza—I am not sure that is the right term—that the Opposition are offering. It is £28 billion in their plan, which is a lot of money for the taxpayer to front up for an un-costed plan that, as far as I am aware, is not endorsed by anyone in the advanced manufacturing sector and what they want to achieve. As we are getting close to our summer holiday, the £28 billion of un-costed promises that the Opposition are making are a bit like lines in the sand. We can look down at them, but the tide of reality will come in.
The Opposition’s proposals mean nothing to industry or to job creation. They are created within the Westminster bubble. [Interruption.] If the Opposition do not believe me, they should listen to the Society of Motor Manufacturers and Traders, the umbrella organisation for the automotive sector. It has talked about the substance in the UK supply chain, which will be a part of this initiative going forward. Unlike anywhere else in Europe, we have a fantastic supply chain with graphene, silicon carbide wafers—I am learning so much—power electronics, batteries and powertrains. It is a substantial boost to our supply chains in the UK. As the hon. Gentleman knows, I am working not only on our critical minerals strategy but on our supply strategy, to make sure we are using UK innovation and UK goods across all our supply chains, and in particular in the automotive sector. I urge him to have some humility and to reverse, and to praise, promote and protect the sector, and definitely not to play politics with it; that is a very weak thing to do.
There are challenges dealing with the rules of origin. As the hon. Gentleman knows, not only the Prime Minister but the Secretary of State are in intensive talks with the European Union. This is an issue not just for the UK; it is also about cars made in the EU being transported into the UK. It is a two-way system. I urge everybody in the House who has contacts with European counterparts to ensure that they make it very clear that this will be damaging for European car manufacturers as well.
Let me turn to the zero-emission vehicle mandate. I have taken many a delegation to the Department for Transport, which is responsible for this bit of policy, and I am keen to back business. The consultation has concluded and results will come through, and we will continue to work with the DFT. My position has always been to back the automotive sector. The hon. Member for Stalybridge and Hyde does not seem to appreciate how substantial the investment is. We should be focused on the £4 billion, the 4,000 jobs and the resilience in the supply chain—the 2,500 small firms across most of our constituencies that will be getting some support because of this fantastic confidence in the UK car and automotive sector, and fundamentally in UK policy when it comes to advanced manufacturing.
Dominic Raab
I warmly welcome the Government’s announcement and Tata’s decision, which highlights the tech potential of the UK. Does the Minister agree that our longer-term strategy, as I think she was setting out, is that we will not be able to engage in a bidding war on subsidies with the US, China and the EU, and that our comparative advantage will be shoring up the supply chain in the context of EV batteries, which means lithium deposits in the south-west and our emerging refinement capacity in Teesside?
Ms Ghani
I warmly welcome my right hon. Friend’s statement and agree with every single point he made. He mentioned the lithium mine in Cornwall, which will eventually produce enough lithium for 500,000 electric cars and vehicles. There is such success for our supply chain because this Government have a strategy that is embedded in the real-world politics of dealing with the automotive sector, and our critical minerals refresh was exactly the support required for the lithium mine in Cornwall.
It is not just about the financial support; it is also about the ecosystem. Fundamentally, the organisation had faith in initiatives such as the Faraday battery challenge, the Advanced Propulsion Centre and the tech in the UK. All the components that are required are here in the UK, and we have been able to link that ecosystem and supply chain together, which gave Tata the confidence to come and build the biggest gigafactory in Europe here in the UK.
Stewart Hosie (Dundee East) (SNP)
I thank the Minister for her statement and early sight of it. I agree that battery manufacturing capacity is important as part of our move towards EVs, away from petrol and diesel vehicles, and towards all our targets to achieve net zero. It would be remiss of me not to mention that a few years ago, as I am sure the Minister recalls, Dundee was given the “most EV visionary city in Europe” award by the World Electric Vehicle Association in Japan.
Let me turn to the statement itself. A £4 billion or so investment by Tata—that’s good. Substantial investment by Envision in battery production in Sunderland, plus the other investments the Minister mentioned, are of course all welcome. Yet that is broadly a comparable sum—around £6 billion—to the investment in the EV charging network we have been promised by 2030. Does the Minister think we are on track to have the right balance between investment in the supply chain and battery production capacity, and in the EV charging network. That network is where most drivers intersect with the system and it is the largest cause of frustration when it does not work or breaks down.
Ms Ghani
I do not think it gets any more positive from the SNP on this point. I am pleased that the right hon. Gentleman welcomed the £4 billion investment and the more than 4,000 jobs, and the confidence we have in the advanced manufacturing sector in the UK; that was such a positive response to what this Government have been able to achieve. I was not aware of the Dundee point, but I will go away and look it up. So many people have been responsible for getting this project over the line and so many have been campaigning for gigafactories. In particular, my hon. Friend the Member for Bridgwater and West Somerset (Mr Liddell-Grainger) has been campaigning for gigafactories for longer than I have been in Parliament, so huge thanks go to him and to everyone else who helped to get this project over the line.
On charging points, as the Minister of State, Department for Transport, my right hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) said in last week’s debate on the automotive sector, ChargeUK has committed to investing more than £6 billion in the development and operation of charging infrastructure before 2030. We heard in that debate that some colleagues felt the investment in their constituencies was not substantial enough. We need to make sure that as demand for EV vehicles grows—there has been much more demand and many more sales recently—the charging infrastructure stands up to that. As the Minister responsible for the automotive sector, I know we are doing everything we can to fulfil our part of the bargain, as it were, but we need to make sure that charging infrastructure is rolled out as fast as it can be. Substantial targets are being met and the Transport Minister is keen to take up constituency cases to make sure that the roll-out is fast as it can be.
Andrew Selous (South West Bedfordshire) (Con)
I am absolutely delighted by this announcement. A number of my constituents work in the Vauxhall van factory in Luton, which makes a fantastic Vivaro van that we want to get electrified. Will the Minister say a little more about how we complete the final piece of the picture so that every car plant in the UK is reassured that there will be UK-made batteries? Yesterday’s announcement was fantastic, but one or two of us are concerned about that last piece.
Ms Ghani
I hope to get an invitation to visit that plant and my hon. Friend’s constituency, and I will of course do my best to promote Vauxhall vans. What is really exciting about this initiative is that it is about producing batteries not just for JLR but for the whole market, which is crucial. With the Tata and Envision gigafactories, we are two thirds of the way to getting to the 100 GW that the Faraday challenge believes we need. We are not complacent and are still going to do everything we can to secure further investment and seek further growth in this area, but for the moment we need to accept that this gigafactory could have gone anywhere in Europe, and there were huge talks about where it was going to be, but Tata had confidence in the UK and decided to come home to us.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
May I say, Madam Deputy Speaker, what a pleasure it is to see you back in the Chair on a regular basis? I wish you and everybody else who works in Parliament a very good recess when it comes.
This is a very welcome announcement. Tata is a good company and this is a big day and a big announcement. Of course, this investment should have been in Huddersfield —I would say that, wouldn’t I?—because we have a wonderful engineering skillset. I do not want to be a downer, but I warn the Minister of this: by the time building work on the canal system was finished, everybody had lost their shirt on their investment because the railways came unexpectedly and all the investment was wiped out. I have recently visited JCB, which has developed hydrogen-powered vehicles; will the Minister make sure that the Government focus equally on hydrogen? Many of us believe that, rather like the railways and the canals, hydrogen will come almost out of the blue and be the major, much more sustainable, future mode of transport.
Ms Ghani
The hon. Member is absolutely right that Huddersfield is a great place. We are not complacent: if the right opportunity, investment and partnership is put forward, we will of course consider that. We want to make sure that we continue to grow our gigafactory capacity. I knew that the hon. Member was going to touch on hydrogen, which he talks about often. The work we are doing with the ATF is not just about electric vehicles but about how we adopt all new functioning technologies to get to the first stage of zero emissions, and then to the next stage and so on. There are opportunities for hydrogen projects to come forward. Just a few weeks ago I visited a major construction project where not only the vehicles on site building and developing the port and the infrastructure were going to be hydrogen, but the vehicles moving on and off the site were to be well. Hydrogen is very much in our sights too.
Fiona Bruce (Congleton) (Con)
I warmly welcome this announcement. Does my hon. Friend agree that it shows this Government’s commitment to real and tangible green investment in the crucial automotive industry, in its supply chains and in many connected businesses throughout the UK, including the environmentally exemplary, forward-thinking transport logistics company in my constituency, Brit European?
Ms Ghani
Brit European sounds like one of the firms I need to meet. No doubt my hon. Friend will invite me to visit, and I look forward to meeting the firm with her. She is absolutely right: this is a huge vote of confidence in our ability to adopt new technologies to achieve net zero. It is not just about finding and securing new sources of critical minerals; we are at the leading edge of battery recycling too. The UK Battery Industrialisation Centre will help us to stay at the forefront of recycling.
Daisy Cooper (St Albans) (LD)
My constituents are desperate to embrace the transition to electric vehicles, whether cars, vans or buses, but electric cars remain far too expensive, and the charging infrastructure barely exists—and where it does exist, it is not reliable. Although investment is welcome, we need a consistent strategy. If the Government are serious about reaching net zero, I urge the Minister to look again at reintroducing incentives to take up electric vehicles. Will she consider giving local authorities a statutory responsibility to roll out, with pandemic-style urgency, the EV charging infra- structure that we so desperately need?
Ms Ghani
When the council in my constituency was Conservative-led, it had a substantial charging point infrastructure roll-out plan, which it had secured itself. When a council is ambitious, it is amazing how much work can be done. We know that sales of electric vehicles are up, as are EV exports and manufacturing, and prices will come down as more come on the market. I am slightly anxious about the sort of incentives the hon. Lady is asking for, if it means just another extra cost to the average taxpayer. We have really good charging infrastructure and fantastic supply chains. As this investment increases confidence in our supply chains, manufacturing will continue to increase and the cars will become even more attractive. My constituents, like hers, want to leave a leaner and greener footprint on the Earth.
Mr Louie French (Old Bexley and Sidcup) (Con)
This is fantastic news for the UK economy, with thousands of skilled jobs and investment in the transition to a lower carbon future. Does my hon. Friend agree that, while Labour continues its rather odd tribute act to new Labour and the likes of Lord Prescott, who famously had two Jags, it is the Conservatives who are delivering inward investment in our country and the UK car industry that will deliver much more?
Ms Ghani
I have learned that it is not a good use of one’s time to focus on what the Opposition are offering, because they U-turn so quickly; by the time one has closed the book they have just published, they have changed their mind. Let us not fret about that.
My hon. Friend is absolutely right. Investment in the automotive sector is on a fantastic trajectory, with not just this commitment but those from Stellantis, Ford, Envision and Nissan. That is because we have a really stellar agenda on how we create and adopt new technology to ensure that advanced manufacturing in the UK competes internationally, as we did with steel, including by helping with high energy costs, which are now coming down. We work hand in glove with the industry. We do not sit around in a Westminster bubble, creating new budgets that are completely uncosted and endorsed by no one in the sector. Yesterday’s and today’s news is fantastic for the automotive sector.
Gavin Newlands (Paisley and Renfrewshire North) (SNP)
I too welcome the announcement—I genuinely do—but we are miles behind European competitors. Some of that is Brexit-related, but mainly it is due to the lack of an industrial strategy, which is even more important in the net zero-related sectors. This Government are miles behind right across the EV sector; other countries are ramping up incentives, but this Government are slashing them. As a result, sales are plateauing. The charging network outside London is a postcode lottery, with some places a charging desert. Scotland had a strategy from day one. That is why we have twice as many rapid chargers per head than even London. When will the Government treat this issue with appropriate urgency?
Ms Ghani
I am afraid the hon. Gentleman is just wrong. First, car sales are up, car manufacturing is up, and car exports even into Europe are up. I am not sure what his view is. He welcomes the £4 billion investment to create the largest gigafactory in Europe, but just cannot bring himself to dwell on the good news it brings to so many of his businesses that will, no doubt, be involved in the supply chain helping us to deliver the cars that will now have UK-made batteries.
Paul Howell (Sedgefield) (Con)
Like so many, I welcome this statement. It provides an incredible, positive message for the UK and for the way we are attracting businesses of the right sort. However, we must remember that there is an existing motor supply chain and it will be taking on many challenges as the industry moves across from what we have now into the electric market. One of the suppliers in that market space is Gestamp in Newton Aycliffe. It supplies motor manufacturers all over the world and is a tremendous company. The Minister has been asking for invitations to visit other businesses, so I invite her to come and see Gestamp and to have a good conversation about the way the supply chain is being impacted by these tremendous investments.
Ms Ghani
My hon. Friend is such a champion of the businesses in his constituency. May I provide him with some confidence? Securing this investment is about providing assurances to everyone in the supply chain that there is now a bigger game for them to play—there will be far more production, sales and, obviously, work for them to do. My hon. Friend has invited me previously; it is an outstanding engagement and I look forward to visiting him shortly. I chair the Automotive Council so I meet a lot of small and medium-sized enterprises, but if I have not already met the firm he mentions, I suggest he gives my private office a little nudge and I will make sure I correspond with the firm shortly.
Mr Tanmanjeet Singh Dhesi (Slough) (Lab)
By 2025, Germany is set to have 10 times more battery capacity than the UK, while the US is set to have 30 times more capacity. I welcome yesterday’s announcement of Tata Group’s investment in a UK gigafactory, but will the Minister confirm exactly how the Government plan to ensure that this will be just the first, not the last, such announcement?
Ms Ghani
The hon. Gentleman has done his homework, but the most important point he needs to remember is that to meet our demand in the UK we need 100 GW. That is not a decision we have taken; it is a piece of work done by the Faraday Institution. Comparing us with the USA or Germany does not really work well, because we are trying to deal with the manufacturing that we have in the UK. So, we need 100 GW; this announcement provides 40 GW, and we have 12 GW with Envision and Nissan, which may go up to 38 GW if they wish to expand. Potentially we are two thirds of the way there, but we do not want to be complacent. When drawing international comparisons, we have to ask how many of the countries—whether the USA or Germany—are two thirds of the way to meeting their battery needs. This is of course not the first or the second step, because we have Nissan already with Envision, but yesterday’s announcement is substantial and we will of course continue to go forward. It shows huge confidence in the UK supply chain and will no doubt attract further investment.
Sara Britcliffe (Hyndburn) (Con)
This is absolutely fantastic news for the UK. Much of the supply chain in east Lancashire can grow further and faster with Government commercialisation and focused investment and support. Will my hon. Friend confirm that the Government are committed to making the UK a leading player in the whole of the EV battery space and that they will work with businesses such as Emerson and Renwick in Hyndburn and Haslingden to support growth in the supply chain?
Ms Ghani
My hon. Friend is a true champion of her constituency and all the firms within it. I am keen catch up with her now we know we have this fantastic deal and to see what more we can do for the many firms in her constituency. We want to make sure that everybody in the supply chain can be involved in this programme of work as it comes through. We have a number of initiatives, whether it is the automotive transformation fund or the Faraday challenge, to ensure that we are doing everything we can to adopt the new set of technology rules and de-risk any new technology that firms have in place. At the moment we think that that will boost 2,500 small firms, but of course if we can involve any more we will do that, and I look forward to sitting down with my hon. Friend and seeing what more we can do for her constituents.
Anna McMorrin (Cardiff North) (Lab)
Of course this new gigafactory announcement is very welcome, but it has taken time. How will it impact the industrial energy price? The Minister has not answered that question and we know that that price is a barrier to decarbonisation and that addressing it will ensure the transition to net zero and lower energy bills, which needs to be prioritised across all sectors and industries in our transition.
Ms Ghani
As a result of Putin’s invasion of Ukraine and high energy prices, we introduced substantial programmes to give energy-intensive firms the support that they needed. The next phase of that is the energy supercharger, which—as the hon. Lady will know—the Secretary of State for Energy Security and Net Zero has been talking about. We know that energy prices will fall in the near future, and that there will be a change in the mix of energy costs.
Tata came to the UK not only because it is, obviously, the best place in which to build a gigafactory and has a fantastic skillset, but because we could offer competitive energy prices. We have had conversations about that with a number of firms and investors. When energy prices were high and we were dealing with energy-intensive industries, we made sure that we provided the necessary support to protect those firms and their employees.
Margaret Ferrier (Rutherglen and Hamilton West) (Ind)
I thank the Minister for her statement, and welcome Tata’s investment. The Adam Smith Institute has said that securing sustainable foreign direct investment is fantastic, but that the UK should also be introducing supply-side reforms so that we can continue to champion carbon reduction on a global scale. In the light of that, what steps are Ministers taking to introduce supply-side reforms?
Ms Ghani
I am working with most industry representatives to establish what we can do about the supply side, not just through reforms but by giving them the assurance, accessibility and resilience that they need to get their products into the country and continue manufacturing, whether in the chemical or the aviation sector. We are working closely with industry, and I hope to present a supply-side input strategy by the autumn.
Rachel Hopkins (Luton South) (Lab)
I have pressed the Minister many times for support to enable good, skilled jobs in the automotive sector and supply chains to be retained in the UK, including those at Vauxhall in my constituency, to which she is obviously welcome to pay a visit at any time. May I now press her to tell us how many public money or subsidy arrangements have been entered into by the Government to support Tata’s welcome choice of the UK for its gigafactory? If she is coy about answering that question, may I also ask how much of the £1 billion automotive transformation fund is left to support existing businesses such as Stellantis, also in Luton South?
Ms Ghani
I know that a visit to Luton South is outstanding, and I hope that we can secure a date soon. The hon. Lady has asked a very good and clever question. As she has said, the ATF amounts to £1 billion, and in due course, with due diligence, the commitments from Tata will be made public. However, the numbers on which we should focus are these. Tata is investing £4.5 billion to build Europe’s largest gigafactory, which is guaranteed to create more than 4,000 jobs and support, potentially, 2,500 firms in the supply chain. Those are the numbers that we should be proud of today, having secured such a stellar investment in a sector that all of us in the Chamber —because we are here on a Thursday afternoon—clearly wish to protect and promote. We won this investment, over any other European country. Tata could have gone anywhere, but it came here because it had confidence in our workers, our companies and our ecosystem.
Jim Shannon (Strangford) (DUP)
I thank the Minister for making such a positive statement. Everyone was enthralled by the announcement that Tata is to invest £4 billion in an electric car battery manufacturing site in Somerset, which is wonderful news for commerce and jobs in the UK, not to mention our contributions to the commitment made at COP26 and COP27, but can the Minister tell us whether sites outside England will be considered in the future? It is said that four battery factories are needed. Has the Minister considered, or is she considering, Northern Ireland as one of those locations, with the aim of boosting commerce in all regions of the United Kingdom of Great Britain and Northern Ireland? I am committed to that aim, and I know that the Minister is. It is good to know that we can all gain advantage from this.
Ms Ghani
It is great that we have a major commitment to one of the biggest gigafactories in Europe. That will generate even more investment and more interest in building gigafactories in the UK. We will, of course, consider all proposals for sites that are brought forward by commercial partners who see value in building gigafactories in the UK. This commitment shores up what we have, takes us towards where we need to be in 2030, and will help us meet our need for batteries, but it will also attract new investment. This is a massive vote of confidence in the UK economy and the UK’s policies on the automotive sector.
May I wish everyone a wonderful summer break, and thank all staff, especially the staff in the Tea Room, who enable us to get through our very long days?
Madam Deputy Speaker (Dame Eleanor Laing)
Indeed. I thank the Minister on behalf of everybody who works in this building. I thank her for taking questions.