Battery producer AMTE Power has identified Dundee as the preferred site for its first 'MegaFactory'.
This should have the capacity to produce more than 25,000 batteries per day, with revenue generation of over £200m per annum at full production.
The total required investment is estimated to be between £160m and 190m.
As a first step, AMTE has received an indicative offer letter from Scottish Enterprise regarding a potential package of funding and business support, which is also expected to facilitate continuing discussions with other UK state-owned enterprises, including the Automotive Transformation Fund.
The MegaFactory is expected to be funded by a combination of grant funding, as well as traditional and government-assisted debt and equity.
The 0.5GWh factory is Dundee has signed a binding Letter of Intent with Michelin Scotland Innovation Parc for the reservation of the site, ahead of a formal lease agreement to be signed in the fourth quarter. Located at the old Michelin factory, the project is expected to help revitalise this brownfield industrial facility, boosting the local economy.
The factory should create around 215 on-site jobs and 800 jobs in the wider supply chain during development and operations.
The plant is expected to be operational and in production by the third quarter of 2025, based on current planned timings.
AMTE's Thurso site remains a core manufacturing facility, focused on production of cells and developing cell technologies.
A statement explained that focusing on high value cell manufacture should enable AMTE to generate good returns at a smaller scale, with associated lower capital investment - and much quicker build and commissioning timeframes - meaning the MegaFactory is considered as a stepping stone towards building 'GigaFactories' in the future.
"The model is repeatable and is expected to enable AMTE to be flexible in meeting market demand for its differentiated cells: Ultra-High Power that has been developed with the automotive industry for high performance vehicles and Ultra-Safe for the energy storage sector being the cells attracting most advanced market interest," the stock exchange update read.
In the electric vehicle market, the UK Government has set a 2030 deadline to end the sale of petrol and diesel cars. In addition, legislation is coming into force in just two years’ time which will stipulate that cars made in the EU or UK need to contain up to 50% of locally sourced materials in order to avoid tariffs. "This presents a significant opportunity for AMTE," the company stated.
Dundee and Thurso are alongside ongoing work to develop high-performance cells at the UK Battery Industrialisation Centre in Coventry and at AMTE's head office in Oxford.
The MegaFactory has received support from the UK Government’s Automotive Transformation Fund, which will help to fund the detailed planning of the Dundee factory as part of the government’s ambition to develop technology for the automotive and energy storage markets.
Kevin Brundish, chief executive of AMTE Power, said: “ The change in our execution strategy will accelerate our journey to mass manufacture of high value added, differentiated cells.
“The MegaFactory will be a platform from which AMTE can harness our advanced in-house capabilities to build manufacturing plants to meet the huge demand for battery cells – allowing us to rapidly scale up production and fast-track the path to achieving net zero.”
Councillor John Alexander, leader of Dundee City Council, said: “This is an exciting proposal which has the potential to deliver hundreds of direct and supply chain jobs.
“All partners are committed to delivering on the vision that we had for MSIP, following the closure of the tyre factory.
“We look forward to working closely with local and national partners to help progress AMTE’s plans and secure this major investment in Dundee.”
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