Tata Motors breaks ground on £4 billion battery gigafactory in UK

5 Feb 2024 , 12:06 PM

On Friday, Tata Motors said that construction on its gigafactory in Somerset, UK, had begun and that the project’s financial closure was in progress.

Tata Motors Group Chief Financial Officer P B Balaji stated during the call following the company’s earnings that while the Red Sea crisis has had some impact on the business, ‘it is manageable at this point in time.’

Tata Motors said earlier in the day that its net profit for the December quarter increased by 133.2 % to ₹7,100 crore, while its consolidated revenue increased by 25% year over year to ₹1,10,600 crore.

‘We have acquired the site and initiated the process of levelling the land there,’ Balaji declared.

In July of last year, Tata Motors revealed its intentions to establish a global gigafactory for battery cells in the UK, with an estimated investment of more than 4 billion pounds, with the aim of facilitating the automotive industry’s shift towards electric mobility.

When it comes to carrying out the plans on the ground there, we are pretty well along. As a result, the project’s financial closure is also happening right now,’ he stated.

‘It is all systems green’ in the UK when it comes to the way the ground is being executed, he continued.

The Red Sea situation has a ‘degree of impact,’ according to Balaji, but he added, ‘We believe at this point in time that it is manageable and we are trying to ensure that we minimise any impact that may come.’ ‘We are finding ways to navigate it for specific lanes, the thick products, and rerouting is adding about 10 or so days to the portfolio,’ he said.

He stated that sales of electric vehicles (EVs) had been rising steadily.

He asserts that there isn’t any cannibalization taking place in the EV and CNG categories.

The CNG and EV segments of the portfolio are showing significant growth, and this trend is anticipated to continue. He added, ‘And these are all incremental volumes.’

Balaji added that the company hopes to have 25–30% of its sales come from electric vehicles in FY25 and FY26.

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