The UK’s electric vehicle battery industry is attracting billions of pounds of investment, with more than £7 billion committed to projects spanning battery production, raw materials, recycling and advanced manufacturing.
New research from transport organisation New AutoMotive has identified more than 14 major commercial battery projects currently operating, under development or planned across the UK.
The findings suggest that Britain is developing a broad battery manufacturing and supply network, covering everything from lithium extraction and chemical processing through to large-scale battery cell production and the recycling of used EV batteries.
The investment comes as the wider UK commercial vehicle industry continues to attract significant investment of its own, with manufacturers and suppliers adapting to changing technology, electrification and new vehicle production requirements.
UK Battery Industry Supports Thousands Of Jobs
The research estimates that the UK’s battery supply chain is already generating around £4.2 billion in annual turnover, while supporting more than 10,000 direct jobs.
Much of this activity is concentrated around established and emerging industrial areas, creating new opportunities for investment and employment as the automotive industry moves away from conventional petrol and diesel powertrains.
The developing infrastructure also extends beyond battery manufacturing itself. Projects are being established across the wider supply chain, including the processing of critical minerals, battery materials, cell production and recycling.
This could become increasingly important as more electric cars and vans enter the UK vehicle parc and manufacturers require reliable access to battery materials.
Growing EV Market Creates Domestic Battery Resources
The report points to the UK’s rapidly growing electric vehicle market as an important part of this developing ecosystem.
With the UK fleet now exceeding two million electric vehicles, the country is accumulating a substantial stock of batteries containing valuable materials such as lithium, nickel and cobalt.
Those batteries could eventually become an important domestic source of raw materials.
Rather than relying entirely on newly mined materials, battery recycling can allow manufacturers to recover materials from batteries that have reached the end of their useful vehicle life and return them to the manufacturing supply chain.
This creates the potential for a more circular battery industry, with materials remaining within the UK rather than being discarded or exported for processing elsewhere.
Battery Recycling Could Reduce Reliance On New Mining
Several UK companies are already developing technology designed to recover valuable materials from used batteries.
New AutoMotive highlights Altilium, which operates in Plymouth and is expanding its activities into Teesside, alongside Recyclus Group in Wolverhampton.
According to the research, hydrometallurgical recycling processes can recover more than 95% of key battery materials, while producing substantially lower carbon emissions than extracting equivalent materials through conventional mining.
For vehicle manufacturers and battery producers, developing this domestic recycling capacity could therefore provide another source of lower-carbon raw materials while reducing reliance on international supply chains.
It could also become increasingly important as the number of EV batteries reaching the end of their first automotive life grows over the coming years.
UK Needs More Battery Manufacturing Capacity
Despite the scale of investment already taking place, the report suggests the UK will need significantly more battery production capacity to meet future demand.
By 2035, domestic automotive manufacturing and energy storage are expected to require approximately 115GWh of battery cells every year.
Current confirmed UK production capacity is estimated at around 60GWh, leaving a substantial shortfall.
Closing that gap could require the development of a further two or three gigafactories, depending on how the market develops and how much battery capacity is ultimately required.
The research argues that creating sufficient demand within the UK will be an important factor in attracting that additional investment.
Electric Vans Will Form Part Of The Growing Demand
The expansion of domestic battery manufacturing is relevant to more than just the UK’s passenger car market.
Electric vans are also becoming an increasingly important part of the commercial vehicle sector, with manufacturers introducing new battery-electric models across small, medium and large van segments.
For businesses considering an electric van, battery technology is only one part of the equation, with charging access, vehicle range, payload requirements and day-to-day operating patterns all important factors when assessing whether an EV is suitable.
For businesses considering the transition to electric commercial vehicles, improvements in battery production, supply chains and electric vehicle charging infrastructure could help support the wider availability of electric models over the longer term.
Battery manufacturing is also becoming an increasingly important consideration for vehicle manufacturers as they develop new electric platforms and seek greater control over the supply of critical components.
Charging Infrastructure Will Also Be Important
The development of battery production capacity is only one part of the infrastructure required to support a growing electric vehicle market.
Businesses operating electric cars and vans will also require reliable access to charging networks, particularly as fleets increase the number of battery-electric vehicles they operate.
Investment in charging infrastructure is therefore developing alongside the wider EV supply chain, with government initiatives also supporting the expansion of the UK’s charging network.
For businesses, access to suitable charging facilities can be just as important as the vehicle itself when planning a transition away from petrol and diesel.
The DfT’s Electric Vehicle Infrastructure Support Service is one example of the wider investment and support being developed around EV charging infrastructure in England.
Fleet Electrification Creates New Demand
The expansion of battery manufacturing is particularly relevant to businesses planning the transition towards fleet electrification.
As more electric cars and vans become available, companies will have a wider choice of vehicles for different operating requirements, while improvements in battery technology could help address concerns around range and charging.
For commercial fleets, however, electrification involves more than simply replacing one vehicle with another. Businesses also need to consider operating patterns, charging requirements, payload, vehicle utilisation and the overall cost of running their fleet.
The development of a stronger domestic battery supply chain could ultimately help support this transition by strengthening the infrastructure behind electric vehicle production.
Long-Term Investment Will Be Important
New AutoMotive argues that the investment already committed demonstrates the scale of the opportunity available to the UK, while further expansion will depend on businesses having confidence that demand for electric vehicles will continue to grow.
The organisation’s chief executive, Ben Nelmes, said the UK had already established significant momentum in its battery supply chain, with more than £7 billion committed to projects supporting the country’s industrial future.
He also argued that businesses require a stable and predictable long-term policy environment if they are to make the substantial investments required to build new battery manufacturing facilities.
The research comes as the UK continues to increase the number of electric vehicles on its roads and manufacturers invest heavily in new zero-emission technology.
The battery sector will therefore form an increasingly important part of the UK’s wider automotive industry, with manufacturing, recycling, raw materials and energy infrastructure all contributing to the country’s ability to support the next generation of electric vehicles.
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