Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
Japanese car giant Nissan has unveiled plans for the UK’s first “gigafactory” producing batteries for electric vehicles, in a £1bn investment plan that secures the future of its Sunderland car plant.
The move is a boost for the North East, and the UK’s car industry as it tries to move from internal combustion engine to electric vehicles, in the push towards net zero.
Nissan has announced that will invest £423m in the Sunderland plant, to produce a new-generation all-electric crossover vehicle, creating 750 new jobs.
And its Chinese partner, battery producer Envision-AESC, is spending £450m building a battery factory next door, which will deliver electric power packs to power the vehicles, creating another 900 roles.
Sunderland council is also onboard – leading an £80m plan to create a “microgrid” of solar and wind farms to power the energy-intensive factories, including a dedicated energy storage facility made from second-hand electric car batteries.
The plan is expected to create around 6,000 direct and indirect jobs in the supply chain.
Gigafactories are vital to the move towards electric cars, and earlier this week the UK’s car industry warned that Britain risks being ‘stranded’ unless the government helped boost capacity. The SMMT called for a “binding target” of 60GWh of battery capacity by 2030, to protect the industry’s future:
The first phase of the Sunderland gigafactory will have a capacity of 9 Gigawatt hours, able to produce enough batteries for 100,000 cars a year, but if demand rises sufficiently, Envision may invest a further £1.8bn to expand the new plant to 25GWh by the end of the decade, the Financial Times says.
Nissan’s plan – merging vehicle and battery production with a renewable power source – is called “EV36Zero”, and chief executive Makoto Uchida says it can be a blueprint for the future of the automotive industry.
“Our announcement comes out of lengthy discussions, and will accelerate our efforts in Europe to achieve carbon neutrality. The experience and know-how gained through the project will be shared globally.”
Prime minister Boris Jonson called it a pivotal moment:
“Nissan’s announcement to build its new-generation all-electric vehicle in Sunderland, alongside a new gigafactory from Envision AESC, is a major vote of confidence in the UK and our highly-skilled workers in the North East.
“This is a pivotal moment in our electric vehicle revolution and securing its future for decades to come.”
Reaction to follow…
Also coming up today…
Chancellor Rishi Sunak is expected to promise to make the UK the most “advanced and exciting” financial services hub in the world, and a hub for green finance, when he outlines a roadmap for the sector at the Mansion House later on Thursday.
My colleague Richard Partington explains:
The chancellor is expected to use his first speech to City financiers at the annual Mansion House address to announce details of a £15bn UK programme of government bond issuance, with the proceeds being spent on environmentally friendly projects.
Aiming to turn Britain into a world leader for low-carbon financial services, Sunak will also launch a separate green savings bond for UK consumers, which he will say is to be used to help fund infrastructure schemes and create more green jobs across the UK.
Bank of England governor Andrew Bailey is also speaking.
The OPEC group of oil producers, and allies including Russia, are holding their monthly meeting, where they’ll decide whether to keep relaxing their production curbs by raising oil output in August.
Britain’s retail sector has suffered another blow overnight, with Gap Inc confirming it plans to close all 81 of its stores in the UK and Ireland – which could cost over 1,000 jobs.
Our retail correspondent Sarah Butler writes:
The US retailer said the stores would close between late August and the end of September this year but it would continue to operate its online store in the UK and Ireland. Gap did not confirm the number of jobs that would go but is estimated to have employed at least 20 people in each outlet.
The decision is the result of a strategic review of the San Francisco-based firm’s European operations that began in October last year. Gap said earlier this month that it would close just 19 stores in the UK and Ireland as they came to the end of their lease.
European stock markets are expected to start the new month with gains, with investors awaiting new healthchecks on UK, eurozone and US factories, and the latest weekly US jobless claims — ahead of tomorrow’s US Non-Farm Payroll report.
- 9am BST: Andrew Bailey: Speech at the Mansion House
- 9.30am BST: UK manufacturing PMI for June
- 10am BST: Eurozone unemployment stats for June
- Noon: OPEC conference begins
- 1.30pm BST: US weekly jobless report