The United Kingdom has announced a landmark £1 billion ($1.33 billion) investment agreement for the construction of a new AESC gigafactory dedicated to producing electric vehicle batteries in Sunderland, northern England. The project, led by Japanese battery manufacturer AESC, is set to provide battery capacity for up to 100,000 electric vehicles annually a significant six-fold increase over the current output.
UK finance minister Rachel Reeves emphasized the importance of the investment, stating, “We are going further and faster to boost our industries’ resilience and encourage their growth. This investment in Sunderland will not only further innovation and accelerate our move to more sustainable transport, but it will also deliver much-needed high quality, well-paid jobs.”
Sunderland is already home to the UK’s largest car manufacturing facility, operated by Nissan. In 2023, Nissan announced a major commitment to producing electric versions of two of its models at the site, further solidifying the region’s role in the future of clean mobility.
To finance the new plant, the British government will offer guarantees via the National Wealth Fund and UK Export Finance, unlocking £680 million in financing from a consortium of major banks including Standard Chartered, HSBC, SMBC Group, Societe Generale and BBVA. An additional £320 million has been secured from private investors and new equity from AESC, according to the government’s official statement.
AESC’s CEO Shoichi Matsumoto called the announcement a major milestone, saying, “This investment marks a key milestone in AESC’s ongoing efforts to support the UK’s path towards decarbonization and the expansion of its EV market.”
The funding will support both the construction and future operation of the new gigafactory, a project expected to play a critical role in driving the UK’s transition toward electric vehicles and greener transportation solutions.
