UKIB boosts the second British battery factory by AESC

The UK Infrastructure Bank has granted battery cell manufacturer AESC a loan of £200 million (€234 mn) for its factory in the North East of England. The bridging loan will support the 15.8 GWh gigafactory in Sunderland, right next to Nissan.

AESC reportedly began constructing the battery factory at the Nissan plant in Sunderland at the end of 2022. The company set the start of operation in 2025 and named an initial annual capacity of around 12 GWh. 

Today’s announcement by UKIB mentions nearly 16 GWh, indicating an expansion of AESC’s plans likely to do with Nissan.

The company is the carmaker’s leading battery supplier and used to be a Nissan subsidiary before the Japanese carmaker sold AESC to Envision Group in 2018. Nissan still holds a 20 per cent stake in the company.

What is more, Nissan, in November 2023, confirmed that it will produce three electric models in Sunderland, namely the bestselling Qashqai and Juke and the successor to the Leaf. The company also announced a further giga-scale battery factory at the time but has yet to disclose the details.

As for AESC, it is their second plant in Sunderland. The existing 1.8GWh facility built in 2012, still under Nissan, is the UK’s only operational gigafactory, as UKIB admits. 

While there have been announcements from different companies such as Britishvolt, fully manufacturer-independent national battery production has yet to materialise in the UK.

UK Infrastructure Bank CEO John Flint said, “This loan signals the Bank’s appetite to play a meaningful role in the financing of the domestic battery supply chain and that we are ready and willing to deploy capital where it is needed for this crucial Net Zero infrastructure.” He added, that Gigafactories are an “essential part” of a supply chain supporting the UK’s transition to net zero. “They also have the potential to secure and create thousands of jobs, but serious investment is needed to scale up production.”

AESC expects to create 1,000 jobs at the new battery factory in Sunderland. It could also supply battery cells to JLR in future. The latter’s parent company, Tata Motors, was also considering building up British battery production but has not followed up on the plans.

Globally, the second facility now under construction is part of AESC’s plan to scale up EV manufacturing capabilities in strategic regions. The plant follows earlier announcements to build gigafactories in Douai, France, the US state of KenEnvision’sraki province of Japan, and Extremadura in Spain.

This will increase the company’s total capacity to more than 150 GWh worldwide and advance its commitment to reach 300 GWh by 2026.


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