ICSM Business News: Britishvolt staves off administration after emergency funding agreed but suppliers take fright after battery firm's future remains in doubt
By Harry Mottram: A start-up company that hasn’t even got off the ground but has a stylish website and flashy offices is in a state of near collapse according to reports despite already having spent lavishly in publicising its plans.
Britishvolt was heralded as the future of British motoring as it planned to manufacture 300,000 batteries to power the new generation of electric powered cars. Yesterday – October 31st, 2022 – it teetered on the brink of collapse after the UK Government refused it a £30 million pound loan as part of a £100 million pound funding package. Then at the last minute a mystery funder stepped in to prevent it falling into administration. However, its long-term future is not guaranteed as its ambitious plans require a further £3.8 billion pounds for it to build a vast factory near Blyth creating 3,000 jobs.
Ian Carrotte of ICSM said the fact the Government took fright should worry all suppliers and contractors involved in the project that hasn’t even begun to build the battery factory. He said all suppliers should be very cautious about giving credit to a firm that was hours away from collapse.
“When you look at the way the project is being put together,” he said, “eyebrows are certainly raised by many as to whether the company has gone about establishing itself in the right way.”
The media is awash with reports on the spending spree such as leasing a seven-bedroom £2.8m mansion with an indoor swimming pool and Jacuzzi for executives as reported in The Guardian and the hiring a ‘Dubai-based fitness instructor to conduct yoga classes for staff over video and travelling in a private jet owned by one of its billionaire shareholders’.
Those shareholders believe Britishvolt will be a global player in vehicle technology in the future. The Guardian reported: “Glencore and Ashtead both made equity investments worth tens of millions of pounds apiece, while Tritax, a property investment company owned by abrdn, said it would eventually provide £1.7bn to construct the factory.”
The accepted wisdom is the firm is on life support after investors took fright when the Government’s £100 million package was withdrawn due to concerns over how the cash was to be spent. In short, the treasury couldn’t see any signs that the site leased from the local authority in Blyth would ever be developed and the cash would only be used to keep the company afloat since it had no income. In what now seems like a distant memory the Government of Boris Johnson heralded the start-up company as part of levelling up the north of England and even a Brexit benefit. Now the staff at their Mayfair office in London together with workers in the North East face an uncertain future along with the supply chain required to build the batteries, construct the factory and sell the technology to the motor industry.
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For details for the work of the journalist Harry Mottram visit www.harrymottram.co.uk