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UK battery manufacturing to deliver £4.8bn per annum to chemical sector

UK battery manufacturing to deliver £4.8bn per annum to chemical sector
A report examining the UK Chemical Supply Chain for Battery Manufacture has found that the UK chemical sector could capture a £4.8bn per annum market share by 2030 meeting the needs of UK-built vehicles alone.

Following a deep assessment of the current capability to support the development and growth of the UK’s battery manufacturing industry, the forecasts are based upon the strong foundation of UK-based companies who are already embedded within many global battery supply chains. Currently three fifths of a vehicle battery pack’s value is the chemicals and materials. With the UK boasting some of the largest suppliers of materials to produce cathodes, anodes and electrolytes, the UK is well-placed to capitalise on this.

Through strategic Government support and collaboration between our Automotive and Chemical sector there is a real opportunity to expand our existing capabilities and grow capacity to support volume production of batteries built in the UK for domestic use as well as significant growth in exports, especially as EU battery production grows.

For battery cell manufacturing to be economically viable there is a need for local suppliers of many materials. However, the expectation is that battery chemistry will evolve over the next decade, so it is fundamental that the companies involved within this supply chain are primed for innovation as well as manufacturing investment. An increase in capability and capacity offers further export potential.

Government has already invested £246m through the Faraday Battery Challenge which has delivered valuable assets like the UK Battery Industrialisation Centre and provided invaluable opportunities for the chemical, battery and automotive sector to work together and learn from one another. In order to realise this £4.8bn supply chain opportunity, the Government will continue to have a critical role to play in supporting the strategic investments in the UK battery and battery materials sectors, while also continuing to provide targeted funding for CR&D that allows the UK chemical sector to co-develop battery technologies with its customers.

Ian Constance, CEO, Advanced Propulsion Centre, said: “with transport shifting towards electrification batteries are set to play a major part in our future propulsion mix. Today’s report highlights the opportunities available to our Automotive and Chemical sectors to come together and collaborate to make the UK the go-to-place in Europe for battery cell manufacturing. We need to ensure that we have a rich and diverse supply chain here in the UK to anchor and attract Automotive OEMs supporting them to grow and flourish from the production of next generation low carbon vehicles.”

Business Secretary, Greg Clark, said: “the challenge to find clean, sustainable solutions for automotive travel is a key part of our modern Industrial Strategy and why we are investing heavily in battery innovation. The Advanced Propulsion Centre is one of our key delivery partners helping to accelerate change in the transition to zero emission and electric vehicles. “I welcome this new report which shows the UK’s strength in the chemicals supply chain and the strong foundation it provides to support the UK’s ambition to be a leading player in battery manufacturing.”