Britishvolt: Canada second factory plans axed as startup's financial struggles continue with Blyth gigaplant

The electric car battery startup, whose main focus is constructing a £3.8bn gigafactory in Cambois, has encountered financial difficulties in recent weeks.

Administration had loomed for the firm until a short term funding lifeline was secured last month.

A spokesperson for Britishvolt said: “This was a difficult decision to take given the growing interest from potential battery cell customers in Canada, the positive engagement of the Quebec Government, and the important role the country plays in the North American auto and aeronautical sectors.

“However, as we have previously stated, to better manage the worsening global economic conditions, including the very significant reduction in available investment capital, we believe the most responsible near-term action we can make is to concentrate on getting our high quality, advanced technology battery cells to market in the quickest and most cost-effective manner.

“This means focusing on our R&D and scale-up facilities in Europe that are key drivers to achieving this goal.”

Former Premier of Quebec Philippe Couillard had worked for Britishvolt in Canada until October, according to his LinkedIn profile.

The spokesperson added: “It also is the case that the recent US Inflation Reduction Act, with its commitment to spend $391 billion on energy and climate change initiatives, is having an impact on the economic viability of large-scale climate projects in other parts of North America including, potentially, battery cell gigaplant construction.

“Having a strong footprint in North America remains a key part of Britishvolt’s business growth strategy and we still hope that we can return to discussions in Canada at some point in the future.”

Britishvolt were promised £100m of UK government funding in January with Kwasi Kwarteng, who was Business Secretary at the time, labelling Britishvolt’s plans to create thousands of jobs as “exactly what levelling up looks like.”

This money is yet to be accessed by Britishvolt, who were refused permission to withdraw £30m of the government funding earlier than planned to help avoid administration.

In addition to securing short-term funding from other sources, the firm’s employees had taken month-long pay cuts in November to help alleviate the financial difficulties.

The start date for production in Cambois has been pushed back until mid-2025.