The owners of the Jaguar Land Rover automotive manufacturer has confirmed it will invest £4 billion, in its first gigafactory outside of India.

Tata Group confirmed the UK had secured one of the largest ever investments in the UK auto industry after a nine month process which will see the UK government provide a range of subsidies and support to secure the project which is expected to create thousands of jobs.

The plant will be built at a site known as the Gravity Smart Campus, near Bridgwater, Somerset, which is owned by Salamanca Group, a privately held, London-based merchant bank specialising in property and infrastructure investment.

UK prime minister Rishi Sunak welcomed the move adding the factor will put the country at the forefront of the world’s electric vehicle industry.

“Tata Group’s multi-billion-pound investment in a new battery factory in the UK is testament to the strength of our car manufacturing industry and its skilled workers,” he added. “With the global transition to zero emission vehicles well underway, this will help grow our economy by driving forward our lead in battery technology whilst creating as many as 4,000 jobs, and thousands more in the supply chain.

“We can be incredibly proud that Britain has been chosen as home to Tata Group’s first gigafactory outside India, securing our place as one of the most attractive places to build electric vehicles.”

Tata said the gigafactory will secure UK-produced batteries for another Tata Sons investment, Jaguar Land Rover, as well as other manufacturers in the UK and Europe. It is believed that the UK was chosen above Spain which had been seen as the favourite site for the facility.

The new gigafactory, at 40GWh, will be one of the largest in Europe. It will create up to 4,000 highly skilled jobs, as well as thousands of further jobs in the wider supply chain for battery materials and critical raw minerals, helping grow the economy and take forward the UK’s commitment to net zero.

Tata chairman, N Chandrasekaran, added: “The Tata Group is deeply committed to a sustainable future across our business.

“ I am delighted to announce the Tata Group will be setting up one of Europe’s largest battery cell manufacturing facilities in the UK. Our multi-billion-pound investment will bring state-of-the-art technology to the country, helping to power the automotive sector’s transition to electric mobility, anchored by our own business, JLR.

“With this strategic investment, the Tata Group further strengthens its commitment to the UK, alongside our many companies operating here across technology, consumer, hospitality, steel, chemicals, and automotive.

“I also want to thank His Majesty’s Government, which has worked so closely with us to enable this investment.”

He continued: “The investment of over £4 billion represents a historic moment for the UK’s growing electric vehicles industry. The new gigafactory will supply JLR’s future battery electric models including the Range Rover, Defender, Discovery and Jaguar brands, with the potential to also supply other car manufacturers. Production at the new gigafactory is due to start in 2026.

“This investment will be crucial to boosting the UK’s battery manufacturing capacity needed to support the electric vehicle industry in the long term. With an initial output of 40GWh it will also provide almost half of the battery production that the Faraday Institution estimates the UK will need by 2030.”

Tata added the battery gigafactory will produce high-quality, high-performance, sustainable battery cells and packs for a variety of applications within the mobility and energy sectors. “The company’s strategic growth plans for its flexible manufacturing capacity will begin with a rapid ramp-up phase and the start of production in 2026,” it added. “The gigafactory intends to maximise its renewable energy mix, with an ambition for 100% clean power. The plant will employ innovative technologies and resource efficient processes like battery recycling to recover and reuse all the original raw materials to deliver a truly circular economy ecosystem.”

There are currently two plans for large-scale battery plants in the UK – a 38GWh plant at the Envisionplant in Sunderland, which is owned by a Chinese corporation and supplies Nissan, and the other in Dundee where AMTE Power is looking at a facility capable of producing over eight million battery cells a year.

Energy Security Secretary Grant Shapps added: “This new gigafactory puts us firmly in the fast lane to becoming the capital of Europe’s electric car market and makes crystal clear how they see the UK as the place to be for their future growth.

“With thousands of jobs on site and in the supply chain, this new factory will be the cornerstone of our automotive industry, backing manufacturers to develop and expand, and customers to make the switch from petrol and diesel.”

The government has said the details of its support to Tata Sons will be published in “due course as part of our regular transparency data”.

Initial reports say the Tata has obtained a deal for support should there be a sharp rise in energy costs, as part of the agreement, alongside an initial £500 million investment.

“Tata Group’s multi-billion-pound investment in a new battery factory in the UK is testament to the strength of our car manufacturing industry and its skilled workers,”

Rishi Sunak, UK Prime Minister