Tata boss will meet Sunak for talks planned to secure UK battery plant for JLR

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The Tata Group chairman is due to meet Prime Minister Rishi Sunak next week for talks that are expected to lead to an announcement that the Indian group will build a flagship electric car battery factory in the UK.

Ministers believe Natarajan Chandrasekaran’s visit will lead Tata to choose a site in Somerset rather than a rival in Spain to supply Jaguar Land Rover, its UK-based carmaker.

THE Nanny the chief will meet Sunak for talks that will focus on the size of a state support package, according to a minister. Downing Street and Tata declined to comment, but a Cabinet insider said: “The mood is very positive.”

A senior Conservative said a deal was “imminent” and another minister said while a deal had not been finalized the “hope” was that the gigafactory near the M5 motorway in Bridgwater would be announced very soon.

The choice, pending for months, was reversed by promises from ministers of a support package worth hundreds of millions of pounds which will include taxpayers subsidizing the plant’s energy costs for years to come.

The Financial Times reports it during the weekend that ministers were increasingly confident that Tata would choose the UK after making the offer of energy subsidies late in the negotiations.

The decision would give a major boost to the beleaguered UK auto sector, which has struggled to attract investment in batteries and has seen car production nearly halve in just three years. The Bridgwater plant would be only the second major battery factory in Britain after the gigafactory which supplies Nissan’s Sunderland plant.

Somerset’s selection would also be a boost for Sunak’s governmentwhich has made the development of green industries a priority.

But it would also signal how Sunak has been reluctantly dragged into a global green subsidy race sparked by US $369 billion Inflation Reduction Act.

Tata is expected to receive site construction grants and funding for new road links, but the major cost will be subsidizing the factory’s energy consumption, which had been the critical factor driving Tata’s decision.

The Indian group had initially requested around £500m in total financial support from the UK, although a final figure is difficult to calculate given that the energy support element of the deal will run for many years.

Tata is also trying to extract more money from the UK government for its steel works in Port Talbot. Ministers have already offered £300m to Tata’s steel operations to help them switch to greener forms of steelmaking.

Executives, however, dismissed that sum as too small given the estimated capital expenditure of £2bn to £2.5bn required to move the Port Talbot steelworks in Wales from blast furnaces to less energy-intensive electric arc furnaces. carbon.

Executives have told officials they are looking for similar levels of support offered to their European rivals, including half the capital investment.

They also want a level playing field on energy costs, as well as a carbon border tax on steel imports, similar to the carbon border adjustment mechanism the EU agreed to last year. Britain’s high energy costs, relative to continental Europe, have been a sticking point in the negotiations.

Tata plans to build the factory with Chinese battery supplier Envision, the same group that runs the Nissan plant.

JLR is due to release an all-electric Range Rover next year, one of a family of seven battery-powered cars as part of a £15bn electrification programme, as it aims to catch up with premium rivals such as Mercedes-Benz and BMW.

Chandrasekaran’s visit to the UK was first reported by the BBC on Wednesday.