Beleaguered battery startup Britishvolt Ltd. blamed the UK’s political chaos for putting off investors but said the cheap pound is now making it an attractive prospect for American investors.
“We’ve had lot of political change and that sort of instability,” said Chairman Peter Rolton, speaking at the site of the company’s proposed factory in Blyth, northern England.
“We lost many investors,” he added. “They were already nervous about the UK.”
Britishvolt was heralded as a key part of the country’s drive toward an electric car manufacturing boom. It planned to produce millions of batteries needed by carmakers ahead of a 2030 deadline for sales of new vehicles that run off fossil fuels.
However, this week it announced short-term bridging finance in a bid to avoid entering administration.
Former Prime Minister Liz Truss’s government triggered a rout on gilts and the pound in September after revealing extensive subsidies for families’ and businesses’ energy use, alongside sweeping, unfunded tax cuts.
Rolton was speaking alongside the opposition Labour Party’s Shadow Business Secretary Jonathan Reynolds who was visiting the site, north of Newcastle.
“It’s the government’s actions with the mini budget that’s made the situation harder for Britishvolt,” Reynolds said. “It’s had an impact on the investability of the UK and how people perceive the UK.”
However, Rolton said sterling’s drop against the dollar had its advantages. “The pound make us a cheap date,” he said. “Investors are thinking ‘hang on a minute we are getting more bang for our bucks’ — so there has definitely been an uptick in interest.”
The less than three-year-old business has the funds to keep it going until early December, while staff have taken a pay cut for November to help it stay afloat.
Rolton said that the company had sought £30 million from the UK government over the weekend, but its request had been rejected. Government funding was key to getting overseas investors to commit funding, Rolton said.
On Wednesday, Bloomberg News reported that Glencore Plc, one of the world’s biggest mining and commodity trading companies, was among lenders that provided less than £5 million in the form of a bridging loan, after the company said it’s pursuing “positive ongoing discussions” with potential funders and has received approaches from “several more international investors in the past few days.”
(By Eamon Akil Farhat and Siddharth Philip)