The company had been struggling for months and had failed to reach ambitious commitments made to ensure additional funding. The company’s administrators, EY, said the UK company did not have sufficient equity for its research and the development of facilities.
The failure of Britishvolt will severely dent the UK’s attempts to modernise its automotive industry and to put in place the supply chain necessary for the next generation of UK-built electric vehicles.
Hundreds of jobs have been lost and plans to build a massive ‘gigafactory’ in Blyth, Northumberland, to take advantage of rising EV demand ahead of the UK’s 2030 ban of new petrol and diesel cars are now pretty much in tatters. The plant was expected to employ about 3,000 workers when operating at full capacity and would have been able to supply 30 gigawatt hours (GWh) of batteries a year.
The question is: could all this have been avoided?
Britishvolt’s inability to secure the funding it needed suggests that investors are now less interested in growth and are more focused on profitability.
According to analysts its founders didn’t have a track record in technology development, the business hadn’t secured all the funding needed to build out the factory and there were no big customers.
The company’s timing may also have been an issue having to confront a combination of factors outside of its control such as the pandemic, inflation and increasing interest rates – all of which made it much harder for it to raise the money it needed to fund investment at a crucial stage of its development.
All of these issues played a part – a long with the government’s failure to provide the funding it had promised – but, according to a number of ex-employees, the business itself got carried away acting like a huge company rather than the startup it was.
So, what does the future hold? Australian-based startup, Recharge Industries, has been chosen as the preferred bidder to take over the company. Recharge has yet to construct a major project but now has the responsibility for delivering on UK hopes.
Whatever the future holds this is a sorry story which saw a chaotic end to a startup that had enormous ambitions and was billed as a cornerstone of the UK’s electric vehicle industry.
In reality, it should have focused on generating revenues and developing its customer base before growing, and spending, at the rate it did. For many start-ups it only needs a few things to go wrong for everything to be completely derailed.
