£1bn battery plant secured for Sunderland in major boost to UK electric vehicle sector
The UK government has secured a £1 billion investment for a major new electric car battery plant in Sunderland, a move hailed as a significant step towards boosting the UK’s green manufacturing capabilities and hitting net zero targets.
The gigafactory, to be built at the International Advanced Manufacturing Park (IAMP) in Washington, will be the second in the city for AESC UK, the battery manufacturing partner of Nissan. Once complete, it is expected to support 1,000 high-skilled jobs and produce enough batteries to power 100,000 electric vehicles (EVs) annually.
Visiting the site, Chancellor of the Exchequer Rachel Reeves said the investment “will not only further innovation and accelerate our move to more sustainable transport, but it will also deliver much-needed high quality, well-paid jobs to the North East, putting more money in people’s pockets.”
The announcement follows a breakthrough UK-US trade agreement last week that saw car export tariffs slashed — a development widely seen as improving the global competitiveness of British automotive exports.
The plant was originally approved in 2023, with the final go-ahead given by the Secretary of State in September 2024 due to the site’s partial location on green belt land. The £1bn funding package will finance the completion of the plant’s construction and support its future operation.
In addition to private investment, the project will benefit from £150 million in grant funding through the government’s Automotive Transformation Fund, which aims to support the UK’s transition to electric mobility.
The Sunderland gigafactory marks a key milestone in efforts to scale domestic battery production and reduce reliance on overseas supply chains — a critical factor in meeting both automotive industry demand and net zero goals.
The plant’s location also reinforces Sunderland’s position as a hub for EV innovation. AESC’s expansion aligns with Nissan’s existing EV production in the region, including the successful Leaf model, and builds on the city’s growing reputation as a national centre for green technology and advanced manufacturing.
As the UK ramps up investment in its EV supply chain, this new facility is expected to play a pivotal role in supporting the country’s automotive future — and delivering economic growth to the North East.
