Coventry gigafactory in limbo as plan faces expiry

Planning permission to build a major battery factory in Coventry is due to expire in a matter of months, as the search for an investor goes on.

The approval for a gigafactory at Coventry Airport will run out in March 2025.

Coventry City Council insists it will meet the conditions to extend its planning permission for two more years.

But planning experts say, with time running out, the council is taking a high-risk and potentially costly approach.

The council has not managed to lure a gigafactory investor to the site since planning permission was granted in 2022.

Industry figures said battery makers could be overlooking Coventry Airport because of a lack of government funding and access to cheap electricity.

Andy Palmer, a veteran automotive industry executive, said he assessed the suitability of Coventry Airport as chairman of battery maker Inobat.

"It certainly was the case that the electrical connection wasn't obvious and would take a long time to get to the Coventry site," the former Aston Martin CEO said.

An abundant and cheap supply of electricity is needed to make batteries for electric cars.

The gigafactory plan has been championed by West Midlands Mayor Richard Parker - and the combined authority he leads is spending £23m on preparing the airport for a potential investor.

Some of that money is being used to fund the connection of additional power to the site.

Coventry City Council is investing £2m as well, and says much more government funding is needed to get the project off the ground.

Jim O'Boyle, the council's cabinet member for jobs, regeneration and climate change, said every major gigafactory around the world had required significant government investment.

The government said it was backing the automotive industry in the West Midlands and across the UK with £2bn to support domestic manufacturing.

"Our industrial strategy next year will focus on the key sector of advanced manufacturing, offering certainty and stability to companies, boosting our competitiveness and unlocking investments in the industry," a spokesperson said.

Coventry City Council has said the development could attract £2.5bn in private investment and create up to 6,000 new jobs.

The local authority has until March to make further planning submissions for reserved matters, including building designs, to extend its planning permission.

"The project is extremely sensitive, so there is inevitably going to be risk around that and reserve matters applications are not an inevitable success," said Adam Sheppard, an assistant professor of urban planning at the University of Birmingham.

He added that, ideally, "you would want the investor on board as early as possible" as they would be "really useful in terms of the shaping process".

The gigafactory proposal has been linked to several companies, including the owner of Jaguar Land Rover, Tata Group, and Chinese battery company EVE Energy.

But a source with knowledge of talks with investors said in the first half of 2024 that a gigafactory deal was not imminent.

Last year, the Tata Group decided to build a £4bn gigafactory at a site close to the Hinkley Point C nuclear power station in Somerset.

An industry source said the site in Somerset was deemed more suitable than Coventry Airport.

"A lot of politicians try to court big businesses in their region," they said.

As the clock ticks on the planning permission, aviation businesses at the airport are frustrated by the uncertainty.

They say they cannot plan for the future, and some companies have relocated or folded already.

Stephen Clark, director of Aerotech Aircraft Maintenance, said customers "don't know whether the airport is viable or not".

"And it's been insidious because of the fact it's gone on for so long," he said.