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The UK government must act quickly to ensure the country can take advantage of the transition to electric cars, according to a new report.

Can the uk take advantage of the electric vehicle revolution

The UK government must act quickly to ensure the country can take advantage of the transition to electric cars and become a centre for the production of vehicles and batteries, according to a new report.

The report, commissioned by the Faraday Institution – the UK’s national centre for battery research – and carried out with experts from Oxford University and McKinsey Energy Insights, says the country ‘risks falling behind’ without a coordinated effort by government and industry leaders to attract the next generation of manufacturing.

In the absence of any major ‘gigafactories’ producing batteries alongside associated electric vehicle (EV) manufacturing, the researchers predict that 114,000 automotive industry jobs would be lost by 2040. But with the right strategy, the UK could instead become a world leader in the production of batteries and EVs, with a potential 246,000 employees in the industry by 2040.

The energy transition from internal combustion (ICE) to electric is under way and has important implications for the UK automotive sector

Engineering Science's Professor David Howey, the principal investigator of the report, said: ‘The energy transition from internal combustion (ICE) to electric is under way and has important implications for the UK automotive sector, calling for up to 200 GWh of annual battery manufacturing capacity in 2040.

‘The electrification of road transport puts jobs in the engine ICE automotive industry at risk, but securing battery manufacturing supply chain can compensate for this. And although other European countries are planning 130+ GWh annual battery manufacturing capacity by 2025, the UK is well positioned to participate in this global competition.

‘Coordination, communication and de-risking for businesses will be required to secure the £5-18bn necessary for this level of UK battery manufacturing capacity.’

The report states that while the UK has had a head start in this race with the establishment of the largest European battery factory in Sunderland in 2010, it risks falling behind. ‘Within a year,’ say the authors, ‘most car producers and battery manufacturers will make their decisions about where in Europe the next generation of gigafactories will be built. We need a timely and coordinated effort by government and industry leaders to attract these gigafactories to the UK, and to secure the future for our automotive industry.’

We need a timely and coordinated effort by government and industry leaders to attract these gigafactories to the UK, and to secure the future for our automotive industry

Co-authoring the report with Professor Howey were Dr Matthias Qian, from Oxford’s Department of Economics, and Dr Adam Saunders, from the Centre on Skills, Knowledge and Organisational Performance (SKOPE) in Oxford’s Department of Education.

Dr Qian said: ‘Adoption of “Industry 4.0” techniques in UK battery production lags behind US and Chinese battery manufacturing facilities. In other words, the skill intensity of battery manufacturing facilities outside the UK is higher than within the UK. The time window for landing the next generation of EV model lines is closing very soon, with most manufacturers committing to location decisions this year. Winning a “gigafactory” – a huge battery manufacturing facility – would help the UK land these new EV model lines.’

Dr Saunders added: ‘The transition to EVs puts the UK’s 186,000 jobs in the automotive industry at risk, so this is firstly a defensive play to protect the existing industry. There is an additional opportunity to attract more battery manufacturers to the UK because of the synergies of co-locating vehicle and battery production. Historically, the battery manufacturing supply chain has been mostly located in East Asia, but there is now a window of opportunity to transform the UK into a global player for battery manufacturing – at the chemical materials, battery cell and battery pack levels.’