The Future of UK Gigafactories

In our latest episode, we spoke with Nikki Rimmington, a strategy expert at battery cell start-up Volklec, about the exciting developments in UK gigafactories.

With experience at Jaguar Land Rover and Aston Martin, Nikki shared her insights into the UK’s journey toward electrification. We explored the challenges and opportunities in battery production, the importance of localised supply chains, and how start-ups like Volklec are carving out a niche in a competitive industry. Here are the key takeaways from our conversation.

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What is Volklec?

Volklec is a UK-based start-up aiming to become the country’s only independent battery cell manufacturer. Unlike large-scale projects like Agratas (for Jaguar Land Rover) and AESC (for Nissan), Volklec targets a different market.

As Nikki explained, "Volklec is positioned to serve a broader range of manufacturers and sectors in the UK," going beyond automotive into diverse industries.

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Who Does Volklec Serve?

While the automotive sector drives most battery demand, Volklec focuses on more specialized markets:

· High-performance, low-volume automotive: Supporting smaller manufacturers often overlooked by large battery suppliers.

· Aerospace: Meeting the growing need for drone batteries.

· Defence: Powering land and aerospace vehicles in the defence sector.

· Off-highway vehicles: Serving major UK brands in this space.

· Other industries: Including rail, marine, medtech, and robotics.

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A "Start Small, Think Big" Strategy

Volklec takes a pragmatic approach, building capabilities and customer relationships gradually to minimize risks associated with large-scale projects. By learning from the struggles of other European battery initiatives, Volklec aims to grow sustainably.

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The Role of Partnerships

Partnerships are central to Volklec’s strategy. Handling R&D, manufacturing, and customer acquisition simultaneously is a significant challenge. As Nikki explained, "Trying to spin too many plates can make things unravel quickly."

Key partnerships include:

· UK Battery Industrialisation Centre (UKBIC): Volklec uses UKBIC’s Coventry facilities to produce battery cells and fulfill orders, demonstrating their capabilities without requiring the capital for a full factory.

· Far East Battery (FEB): Partnering with this experienced battery company allows Volklec to offer proven technology while reducing risks for customers.

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Challenges of Building a Gigafactory

Constructing a gigafactory comes with significant challenges. Nikki highlighted several key factors that must be addressed.

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Location Challenges

· Skilled Workforce: Factories need access to a sustainable, skilled labor pool. Proximity to hubs like the Midlands or North East offers a competitive advantage.

· Energy Needs: Gigafactories require substantial energy, making renewable energy infrastructure essential for sustainability.

· Community Engagement: Successful projects build strong relationships with local communities. For example, Tesla’s Berlin factory faced delays due to poor engagement.

Operational Hurdles

· Securing Investment: To attract investors, start-ups need clear plans, proof of demand, and a strong market fit—a tough "chicken-and-egg" problem.

· Product Focus: Factories must align with specific battery chemistries and formats. While flexibility is ideal, trade-offs are often necessary.

· The "Valley of Death": Bridging the gap between ideas and market-ready products remains a major obstacle for new manufacturers.

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Building the Battery Ecosystem

Our conversation also explored the evolving battery ecosystem, from government policies to recycling.

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Recycling and the Circular Economy

Battery manufacturers must manage the entire lifecycle of their products. EU regulations now require increased recycled content and traceability, driving the demand for better recycling systems.

However, a surprising challenge has emerged: batteries are lasting longer than expected. This shortage of old batteries complicates efforts to meet recycled content mandates. Nikki also highlighted innovations like replacing faulty battery cells instead of entire modules to further extend battery lifespans.

Government Support

The UK government has identified batteries and automotive as priority industries, offering support through investment zones, geographical clusters, and funding bodies like the Advanced Propulsion Centre (APC). These initiatives aim to strengthen the ecosystem needed for gigafactories and help start-ups overcome the "valley of death."

Nikki emphasized that demand remains the biggest challenge. While the need for electrification is clear, the UK’s smaller market must generate critical mass demand to drive investment, strengthen supply chains, and accelerate progress.

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Looking Ahead

What will it take for the UK battery sector to succeed by 2030? Nikki envisions:

· Stronger demand: A significant shift toward electrification across industries.

· Investor confidence: More investors willing to take risks.

· A robust ecosystem: Growth in supply chains, from raw materials to recycling.

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