UK Announces £1 Billion Deal for AESC EV Battery Gigafactory in Sunderland
The UK government on Friday unveiled a £1 billion ($1.33 billion) funding agreement to support the construction of a major AESC gigafactory in Sunderland, a move aimed at significantly scaling up the country’s electric vehicle (EV) battery production capacity.
The facility, to be built by Japanese battery maker AESC, will supply enough batteries for up to 100,000 EVs per year, marking a six-fold increase over current output. The project is expected to play a key role in accelerating Britain’s transition to greener transportation and boosting domestic manufacturing.
“This investment in Sunderland 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,” said Finance Minister Rachel Reeves in a government statement.
The gigafactory will be located near Nissan’s car manufacturing site, the largest in the UK. Nissan previously committed in 2023 to building electric versions of two of its car models at the Sunderland plant — a signal of deepening EV production in the region.
Funding Breakdown:
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£680 million in financing unlocked via financial guarantees from the National Wealth Fund and UK Export Finance.
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Backed by major banks including Standard Chartered, HSBC, SMBC Group, Société Générale, and BBVA.
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The remaining £320 million will come from private sector financing and new equity provided by AESC itself.
AESC CEO Shoichi Matsumoto welcomed the announcement, stating:
“This investment marks a key milestone in AESC’s ongoing efforts to support the UK’s path towards decarbonisation and the expansion of its EV market.”
The Sunderland gigafactory is part of Britain’s broader strategy to reshore critical EV supply chains, reduce reliance on overseas battery imports, and solidify the country’s position in the fast-growing global EV economy.
