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Report: UK’s EV revolution will create 50 million sq ft of Gigafactories

If the UK is to meet its 2040 target of ending new petrol and diesel vehicle sales, the national Gigafactory stock will need to grow to as much as 50 million square feet of factories and warehouses.

The UK Government's current vision involves bringing seven Gigafactories online by 2027 

The UK Government’s current vision involves bringing seven Gigafactories online by 2027 

That is the headline conclusion of a new report from real estate services giant Savills, entitled ‘The Rise of Gigafactories’.

The report takes into account the UK Government’s ban on new petrol and diesel car sales, which will come into force from 2030, and its vision to also end new petrol and diesel van, heavy goods vehicles, bus and coach sales by 2040. Both of these policy visions were announced this year, in the lead-up to COP26.

Also accounted for is the significant growth in the Gigafactory project pipeline in recent times. Even before the new phase-out dates were confirmed by the Government, many automakers were preparing for exponential growth in electric vehicle (EV) sales.

A facility in Blyth, Northumberland, is set to become the UK’s first Gigafactory after BritishVolt gained planning permission in July and began work onsite shortly afterwards. It is expected to begin operations in 2023, with a 10GWh phase, and have two more phases of equal capacity added through to 2027.

Elsewhere, Nissan this summer unveiled plans to transform its Sunderland plant into an EV hub featuring a 9GWh Gigafactory. Then, Coventry Airport and Coventry City Council filed a planning application for a Gigafactory on the Airport’s estate. Tesla is also exploring the possibility of a UK site.

Nonetheless, the Savills report concludes that more action and investment from the private sector will be needed to scale Gigafactories in the UK at the scale and pace needed to support Government targets.

Investment could be leveraged, it argues, with better Government planning and strategizing to identify which sites are suitable for Gigafactory development and to make rents in these locations more affordable. More will also be done to ensure sites can access the energy they need and deliver the jobs they promise.

On the sites piece, the report states that Gigafactories and their associated warehouses could take up as much as 2,500 acres of land by 2040 – the same area size as the City of London. Careful planning will be needed to minimize environmental degradation, ensure energy access and attract workers – as well as ensuring affordability for developers.

To this latter point, Savills’ head of industrial and logistics research Kevin Mofid said: “With land values for prime industrial and logistics development sites rising by 32% in the past year, affordable land remains hard to come by.

“For this reason, the regions most likely to see Gigafactories locate are those markets where the public sector partners can help by delivering space for regeneration purposes. This primarily points to former areas of heavy industry where significant tracts of brownfield land are available, which already have large power supplies. This is why areas like the North East and South Wales seem very attractive to battery producers.”

Policy pressure

Recent months have seen a flurry of green policy announcements in the UK, with packages including the Heat and Transport Strategy, Environment Bill, Hydrogen Strategy and overarching Net-Zero Strategy progressing.

But there is still not a specific strategy for EV manufacturing, and the long-awaited updated skills plan is still in the pipeline.

MPs on the Environmental Audit Committee (EAC) wrote to Ministers urging further funding for Gigafactories in June. The Committee’s letter outlines how other governments are typically supporting Gigafactories at a rate of £750m per plant, while the UK has pledged just £500m to the sector collectively, through the Automotive Transformation Fund. This is despite an ambition for the UK to host seven Gigafactories by 2027.

Then, in July, the House of Lords’ Science and Technology Select Committee released a report warning that there is only a short window of time in which to change EV-related policy significantly enough to align with key climate targets and ambitions on job creation, skills and economic growth. The Committee expressed particular concern over the readiness of the supply chain.

Sarah George

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