In the wake of Britain’s stumbling efforts to domestically manufacture electric vehicle batteries, a new startup is taking a different approach. Coventry-based Volklec has inked a deal to license technology from Far East Battery (FEB), a well-established Chinese firm, to produce batteries for a range of applications, from cars and boats to construction vehicles and aircraft. This move underscores a strategic shift, focusing on learning from past mistakes and leveraging proven technology to accelerate market entry.
Volklec’s ambitious plans are bolstered by the appointment of former Lotus Cars CEO Phil Popham as executive director. Popham brings a wealth of industry experience and a clear vision for navigating the complexities of battery manufacturing. “We believe there is a robust market for an independent British manufacturer,” Popham stated, highlighting the need for a UK-based battery supplier to cater to businesses that lack the demand for a full-scale gigafactory.
The startup aims to commence battery production this year at the UK Battery Industrialisation Centre (UKBIC), a government-supported research facility in the West Midlands. Following this initial phase, Volklec will scout for a site to construct a factory capable of producing batteries with a cumulative capacity of 10 gigawatt hours (GWh) annually. This phased approach is designed to mitigate risks and ensure sustainable growth—a lesson learned from the failures of previous British attempts.
The UK’s struggles to attract significant investment in battery manufacturing are well-documented. Currently, only two companies operate gigafactories in the UK: Chinese-owned AESC, supplying Nissan’s Sunderland factory, and Agratas, owned by Indian conglomerate Tata, which is building a facility in Somerset to supply Jaguar and Land Rover. These factories aim to produce batteries with total capacities of 38GWh and 40GWh respectively, sufficient for hundreds of thousands of vehicles each.
However, Volklec’s strategy diverges from these large-scale operations. By focusing on a more modest initial output and leveraging FEB’s technology, the startup aims to fill a gap in the market for smaller, independent manufacturers. “Those companies that haven’t been successful, it’s because they tried to get to our stage three, rather than our stage one,” Popham explained, emphasizing the importance of a incremental approach.
The partnership with FEB, however, raises concerns given the current geopolitical tensions. Despite this, UK Chancellor Rachel Reeves has actively sought Chinese investment to bolster economic growth. Volklec’s dependence on its Chinese partner is a calculated risk, with the company planning to mirror FEB’s manufacturing processes and procure materials at costs available to larger firms.
Volklec’s co-owner, Imran Khatri, along with his brother Sameer, brings experience from previous investments, including the now-defunct Britishvolt. Popham acknowledges the complexities of battery manufacturing, stating, “Battery manufacturing is complex. The engineering is complex. It takes time, and it takes investment.” The first phase involves producing 100 megawatt hours of batteries on UKBIC’s existing lines, with plans to scale up to 1GWh by the end of 2026. This initial stage, described as a “springboard into a gigafactory,” is estimated to cost around £100m, with £20m committed from the Khatris. The subsequent 10GWh phase is projected to require approximately £1bn in investment and at least five years to complete.
Volklec’s entry into the battery manufacturing sector could reshape the construction industry’s approach to sustainability. As electric vehicles and machinery become increasingly integral to construction sites, the demand for reliable, high-performance batteries will only grow. By adopting a phased, low-risk strategy and leveraging established technology, Volklec aims to provide a stable supply of batteries tailored to the diverse needs of the construction sector.
This development poses critical questions for the industry: How will the integration of electric vehicles and machinery, powered by advanced batteries, transform construction practices? Will the reliance on Chinese technology spark a broader debate on geopolitical risks and supply chain resilience? As Volklec navigates these challenges, its success or failure could set a precedent for future ventures in the UK’s battery manufacturing landscape, shaping the intersection of sustainability and construction in profound ways. The industry will be watching closely, as the outcomes could influence everything from project timelines
