WATCH: Tata's car battery factory is on the way to the UK 

An investment of over $5 billion (£4bn) by Indian giant Tata into its flagship electric car battery factory in the UK is a game-changer for the country's automative industry and the businesses connected with the green energy transition.

That's the view of Professor Peter Wells, Director of the Centre for Automotive Industry Research at Cardiff University.

"It's certainly desperately needed for the industry as a whole in the UK," Wells told CGTN, a day after the announcement of the new plant in Somerset that is expected to create 4,000 jobs in the UK and thousands more across the supply chain, while producing an initial output of 40 gigawatt hours.

"This battery investment will make a significant difference, primarily to Jaguar Land Rover, but also to the wider development of our battery electric industry. 

"It will also help other smaller manufacturers, of whom we have many and we could possibly have more in the future. The UK has a history of specialist car manufacturing and to have an available source of batteries within the economy and within the country will make a big difference to them as well."

The new gigafactory, which will also produce batteries for other UK and European manufacturers, has been described as the most crucial investment in UK automotive since the arrival of Japanese company Nissan in the 1980s. It will be one of the largest in Europe with production due to start in 2026.  

UK Prime Minister Rishi Sunak said: "With the global transition to zero emission vehicles well under way, this will help grow our economy by driving forward our lead in battery technology.  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."

There have been no figures from the UK government regarding the financial support it has offered to fend off Spain, which was also in the running for the project, but it is understood to be a considerable amount of money.

Wells said the investment was likely to be "substantial", while it is understood the government is providing subsidies worth hundreds of millions of pounds.

"We don't know what the Spanish government was offering, and in these circumstances, there's often a lot of negotiation in the nature of the deal," added Wells, who specializes in business and sustainability in the global automotive industry. 

"The location already has advantages for Jaguar Land Rover though. The site itself is big, it's got plenty of room, it's got good logistics links and a good source of power next to it. All of these things make sense and help."

UK's strategy in the car industry and moves towards a more carbon-free environment have been criticised. It has lagged behind European rivals in building electric vehicle battery gigafactories, with more than 30 planned or under construction across the EU. The UK has one small Nissan plant and another in the works.

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"The UK and EU are both a bit behind," Wells said. "I would say the UK is somewhat behind Europe in terms of the uptake of this kind of approach to manufacturing and car technology. 

"On the other hand, I think the UK is advanced in the underlying technology skills and the science behind battery electric vehicles, in the chemistries of battery electrics and so on. So there's a lot of strength in research and development in this area, which will be important in the future. 

"This is not a static technology. There is a high rate of change and having that capability to remain at the forefront of the technology will also be an important asset in the future."

Under net zero goals Britain plans to ban the sale of new petrol and diesel cars from 2030, and under post-Brexit rules automakers will also need to source more EV components locally to avoid tariffs on UK-EU trade from 2024.

UK's Investment minister Dominic Johnson said the factory "really does move the needle and acts as a massive beacon for the global car industry to say that the UK is back in business."

He added that when Britain lost out on Tesla's European gigafactory in 2019, the government decided it was never "going to let that happen again.'"

"We were absolutely focused on winning this investment," he added. "As soon as it got out that we may be in the running to win this amazing investment, we started to get some quite interesting inquiries from other companies."

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