Automakers invested billions in U.K. EV production, then ICE ban deadline shifted

Europe

The announcement by the British government that it would delay a ban on new gasoline and diesel cars and vans to 2035 from 2030 brought swift pushback from automakers, who have invested billions of pounds to build EVs in the U.K. on the assumption that they could not sell combustion cars after 2030.

Automakers with a U.K. car manufacturing presence include Bentley, BMW’s Mini and Rolls-Royce, Jaguar Land Rover, Nissan, Stellantis and Toyota. Ford builds parts in Brtiain.

Many of them have recently announced plans to build full-electric vehicles in Britain, despite what many see as an unfavorable trade environment after Brexit. Smaller companies with EV aspirations include Aston Martin and Geely’s London Electric Vehicle Company. 

Stellantis this month said it was starting electric-only van production at its Vauxhall factory in Ellesmere Port, which it says is the U.K.’s only manufacturing site dedicated solely to EVs. The site’s future had been uncertain after Brexit, but Stellantis in 2021 decided to invest 100 million pounds to retrofit it for electric van production.

Even after Prime Minister Rishi Sunak’s announcement Wednesday to delay the ICE ban, Stellantis remains committed to selling only zero emission cars and vans in the EU and the U.K., a spokesman told Automotive News Europe. “Our range will progressively move towards 100 percent electric, ahead of current legislation.”

The Ellesmere Port plant will produce a range of compact vans, including the Vauxhall Combo Electric, Opel Combo Electric, Peugeot e-Partner, Citroen e-Berlingo and the Fiat E-Doblo.  

“Clarity and reasonable anticipation are important from governments where we operate on important legislation, including environmental issues, given the planning cycles of our sector,” the Stellantis spokesman said.

Other automakers that have committed to building EVs in the U.K., where overall auto production has halved since the 2016 Brexit referendum include:

The Volkswagen Group ultraluxury brand said in 2022 that it would invest 2.5 billion pounds in sustainability, including turning its Crewe, England, production site into a “Dream Factory” where the brand’s battery-electric car will be built by 2025. Bentley will switch its entire model range to full-electric vehicles by 2030.

Ford said in December that it will invest 150 million pounds at its Halewood powertrain site to convert production to electric motors, following an earlier investment of hundreds of millions of pounds. Ford has also received a total of 1.4 billion pounds in financing backed by the government’s U.K. Export Fund, or UKEF.

Tata, the parent company of JLR, said in July that it will build a battery factory to supply future battery-electric models including the Range Rover, Defender, Discovery and Jaguar brands. Investment will total 4 billion pounds. For its part, JLR will invest 15 billion pounds ($19 billion) over the next five years in electric vehicles, including investing in its Halewood, England, factory to make only EVs. It will also retool its current engine manufacturing factory in Wolverhampton to produce electric drive units and assemble battery packs.

The BMW Group brand said as recently as last October that it would stop making electric versions of Mini hatchbacks at its factory near Oxford, England. But on Sept. 11 BMW announced it would invest 600 million pounds (750 million euros) in Oxford to take the Mini brand all-electric by 2030. Starting in 2026, the automaker will make two electric models at the English plant: the three-door version of the Mini Cooper and the Aceman compact crossover. BMW will also invest in its U.K. plant in Swindon that makes parts for Mini models.

The Japanese automaker’s Sunderland factory, its lone European facility, has been facing cost pressure for years. Nissan and its battery partner AESC Envision said in 2021 that they would invest 1 billion pounds in the site, including 423 million pounds from Nissan to build a new full-electric crossover that could replace the Leaf in the brand’s lineup. But even as recently as April, Nissan warned that it needed more help from the U.K. government to secure the site’s future.

The ultraluxury brand is building its first EV, the Spectre, at its Goodwood factory, but Rolls-Royce has not released the scale of any investments in the factory – but, like Bentley, it plans to be all-electric by 2030.

In contrast to other automakers with U.K. production footprints, Toyota has been quiet on an EV future for its factory in Burnaston, England, which builds the Corolla, and its engine factory in Deeside, Wales. One zero-emission project involves a hydrogen fuel cell powered Hilux pickup prototype built at Burnaston, but investment is only in the tens of millions of pounds.

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