UK lithium-ion battery firm secures funding to avert collapse

UK battery manufacturer Britishvolt has been saved from the brink of collapse after securing last-minute funding.

The firm, which makes lithium-ion batteries for electric vehicles, partnered with Monaco-based shipping giant Scorpio Group earlier this year to research battery power and innovation for the maritime sector. In May, Britishvolt bought the German battery-cell maker EAS for €36m.

Britishvolt is behind a planned £3.8bn ‘gigafactory’ in Blyth in Northumberland, which would employ 3,000 people. In January, the firm secured financial backing from the government’s Automotive Transformation Fund (ATF), which is designed to help the country transition to electric vehicles.

However, on Monday (31 October) Sky News reported that the £100m of pledged funding had yet to be paid. Sky reported that Britishvolt, which has around 300 staff, was finding it difficult to get an answer from the government about the apparent delay, and had been forced to seek cash elsewhere in recent months.

The BBC states that the firm had wanted to draw down nearly a third of the funding early, but the government refused, leading to the stand-off. Former business secretary Grant Shapps is reported to have called the management “totally chaotic” and said he could not hand taxpayers’ money to the company as it had failed to meet agreed targets.

On Monday afternoon, the Financial Times reported that the company could enter insolvency later in the day, and was preparing to appoint administrators.

In response to a request for a statement, a Department for Business, Energy and Industrial Strategy spokesperson told Sky News: “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 best value.

“We do not comment on speculation or the commercial affairs of private companies.”

Shortly before 9pm on Monday (31 October), the BBC reported that Britishvolt had secured enough cash for the business “to stay afloat in the short to medium term,” according to sources with understanding of the matter.

The sources would not comment on the identity of the new backer or backers.