Battery firm Britishvolt on the brink of collapse

BRITIShVOLT has been left on the brink of collapse after failing to attract enough funding for a multi-billion pound battery plant in Northumberland.

The start-up was planning to build a massive £3.8bn ‘gigafactory’ in Blyth that would make batteries for electric cars and create 3,000 jobs.

But the company is facing bankruptcy after emergency fundraising talks over the past few weeks appeared to have failed.

The start-up manufacturer – which was reportedly considering a stock market listing last year to help raise the £2bn needed for the factory’s construction – was in talks with several parties to raise £200m or sell the company outright.

Those thought to be interested included India’s Tata Motors, the owner of Jaguar Land Rover.

Britishvolt, which is backed by mining and commodities giant Glencore, was diverting funds from the Blyth factory site to its battery work in an effort to boost orders and supplement its shrinking cash reserves. Matters were made even worse after government ministers scrapped plans to inject £100m into the company when it was discovered the funds would be used to keep it afloat rather than constructing the factory.

The cash was also contingent on the company hitting a certain milestone in its construction work, which has not been reached.

Britishvolt is now thought to have around one month’s cash left, sources familiar with the matter told the Financial Times.

A spokesman said the company was ‘aware of market speculation’ and was ‘actively working on several potential scenarios that offer the required stability’.

The firm’s failure is expected to trigger a scramble from other firms to secure ownership of the Blyth site, which is considered to be one of the best battery manufacturing locations in Europe due to its rail and sea links as well as access to clean energy.

Labour MP Jonathan Reynolds, the Shadow Business Secretary, said the news of the impending collapse was ‘disastrous’.

‘It is a sight that has become all too familiar – businesses going under, jobs being lost, and investment in the industries of the future going abroad rather than the UK,’ he said.

A government spokesman said it would ‘not comment on speculation or the commercial affairs of private companies’, before adding: ‘We are determined to ensure the UK remains one of the best locations in the world for automotive manufacturing as we transition to electric vehicles, while ensuring taxpayer money is used responsibly and provides the best value.’

Britishvolt’s pending collapse threatens to dash hopes for a UK-based battery maker amid growing demand for electric cars across the world.

It was hailed as a ‘levelling up opportunity’ by then Prime Minister Boris Johnson, with the Government’s £100m funding pledge helping the company raise £1.7bn from private investors.

But cracks began to show after the firm was forced to delay the start of production at the plant twice, blaming factors such as inflation and rising interest rates.

The company had initially planned to begin at the end of next year before being pushed back to the end of 2024 and then to mid-2025.