Nissan is to open a large-scale battery factory in Sunderland in a move that will create around 6,000 jobs. Business secretary Kwasi Kwarteng said he believed the move could have a “domino effect” that resulted in further battery production facilities after a recent report warned that the UK is being left behind when it comes to building electric cars.

Green campaign group Transport and Environment (T&E) says that the UK produced roughly half of all electric cars built in Europe in 2018, but that lack of investment could mean that sinks to 4% by the end of the decade.

The FT reports that the first phase of Nissan’s site will have a capacity of 9 GWh – sufficient to produce batteries for 100,000 cars a year.

However, T&E points out that this amounts to, "a tiny fraction of the 474 GWh of production at 17 sites across Europe for which funding has already been secured."

Nissan’s battery supplier, Envision AESC, will invest £450m building the plant. The government has also reportedly provided about £100m of support.

Nissan has plans to make a new electric vehicle in Sunderland. If demand rises sufficiently, Envision could invest a further £1.8bn to expand the new plant to 25 GWh by the end of the decade.

The Society of Motor Manufacturers and Traders estimates Britain needs 60 GWh of battery plants to maintain the current size of the industry into the next decade.

Chief executive Mike Hawes welcomed the Nissan announcement, but added: “It’s a fiercely competitive industry, and we need more than that.”

The project will also see Sunderland city council creating an £80m local energy grid, installing wind farms, solar parks and a dedicated energy storage facility made from second-hand electric car batteries.