Nissan plans to turn its Sunderland plant into a battery megafactory

Nissan is currently embroiled in talks with the UK government to turn its Sunderland facility into a battery megafactory as it looks to turn Britain into a hub for electric vehicle production.

The plans could support the creation of up to 200,000 new electric vehicles every year, the company claims.

Read more: Nissan chief hails Brexit victory as it looks to expand UK production

The FT reports the plant will be run by Nissan's Chinese battery supplier AESC and that the company is currently seeking financial support from the British government in the range of tens of millions of pounds.

Talks began in earnest following the UK's withdrawal from the European Union, which Nissan's chief said has given them a unique business opportunity to become completely economically independent as it seeks to push for greater electrification.

Part of the UK-EU deal stipulates that suppliers must source batteries from within the EU or UK by 2027 or face sanctions.

The automaker was hit hard by the coronavirus pandemic, having to temporarily halt production in March of last year.

It also faced production shortages owing to the ongoing semiconductor shortage, which has been particularly brutal for the automotive industry as it looks to shift away from traditional combustion engines.

Increasing domestic battery production is also important for meeting the climate targets set out by many governments, with countries such as the UK and Portugal opting to ban the sale of fully petrol and diesel vehicles by 2030 and 2035, respectively.

A spokesman for Nissan told the FT: “We are dedicated to securing gigafactories, and continue to work closely with investors and vehicle manufacturers to progress plans to mass-produce batteries in the UK.”

Read more: VW & BMW to face reduced EU fines over emissions collusion

AESC already provide batteries for the Nissan Leaf, which is currently the best-selling electric model in Europe.

Electric vehicle sales are expected to increase sharply throughout the decade, as climate targets are revised and with the potential for further bans on traditional vehicles.

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