Licensing agreement or equity partnership
This is indeed what the Indian media Autocar Professional reports. Depending on the articles of association, it could be a license agreement or even an equity partnership. The precise terms of the collaboration should be decided in the coming months.
Either way, the partnership would involve NMC cells for Tata subsidiary JLR, but the development of solid-state batteries could also be explored.
Tata cell factories in UK and India
At the start of the summer, Tata announced plans to build a cell factory in the Indian state of Gujarat and another in the UK. The Financial Times is now reporting that AESC will be heavily involved in Tata’s planned battery cell factory in the UK, among other projects.
AESC technology before that of Tata
According to the newspaper’s sources, the Tata subsidiary, Agratas, which will supply the batteries for JLR’s future electric cars, is looking to develop its own technology but would need more time to prepare it.
AESC will thus “provide the technology for the first generation of batteries which will be manufactured” at the Somerset battery factory in the United Kingdom. It is expected to supply battery cells for electric Jaguar models from 2025, vehicles which the battery maker is likely to produce at its new plant in Sunderland (UK).
Majority stake of Chinese Envision AESC
Envision AESC is headquartered in Japan and was founded in 2007 as a joint venture between three Japanese companies. With the Automotive Energy Supply Company (AESC) focusing on electric vehicles from the start, Nissan was then the largest shareholder with 51%.
In 2018, however, Chinese energy group Envision acquired a majority stake in AESC.
Envision AESC already has a cell factory in the USA: not far from the Nissan vehicle factory in Smyrna (Tennessee), Envision AESC produces battery cells for the Japanese manufacturer.
Our opinion, by leblogauto.com
Extremely difficult therefore to overcome Chinese supremacy in the field of battery cells. If the Indian Tata Motors tries to take up the challenge…. by dealing with a Japanese company… in the end, China is never far away….
According to the Financial Times, JLR and Tata have been reluctant to confirm AESC’s involvement. Last month, JLR chief executive Adrian Mardell said contracts “had been signed” to supply JLR’s batteries before the Tata factory went live, but added he was not “not natural” to name these suppliers.
When asked if Envision was involved in the Tata factory, he replied: “I am not in a position to speak about Agratas.”
Kemi Badenoch, Secretary of State at the Department for Business and Trade, Secretary of State for International Trade and President of the Chamber of Commerce, praised in June the role played by Envision in Sunderland, but warned that the UK should not become “too dependent” on Chinese battery technology.
Sir Iain Duncan Smith, a former Conservative leader, said the UK was in danger of becoming “even more dependent on China”. Adding: “China has very many battery factories and they will flood us with cheap electric cars” as the UK phase out of new petrol and diesel car sales approaches in 2030.
Sources: autocarpro, Financial Times