BMW is planning to invest up to £600 million in its Mini plant in Cowley, near Oxford, according to the sources. It is anticipated that the funds will be used to prepare the plant for future production of electric models.
The government has offered BMW $75 million in aid. In 2019, the first generation of electric Minis was introduced at the Cowley plant. The original model was adapted to operate with an electric motor and batteries from an existing design.
The company announced last year that the majority of its electric vehicles would be manufactured in China by a joint venture between BMW and Great Wall Motor. The Countryman electric model would be manufactured in Leipzig, Germany.
BMW argued at the time that building conventionally powered and electric vehicles in the same factory was inefficient. It also asserted that Oxford would continue to be the "home of the Mini" and that no jobs would be lost.
As the sale of non-hybrid gasoline and diesel-powered vehicles will cease in 2030, the factory will be forced to produce electric vehicles once more if it wishes to continue operations. By 2030, all Minis will be electric.
BMW stated in a statement that it maintained "continuous and productive dialogue" with the British government, but declined to comment on any future production plans. An announcement from BMW would be a positive development at a time when analysts have questioned the future prospects of the British automobile industry, given the sector's global transformation.
According to the Society of Motor Manufacturers and Traders, in 2022, British production reached its lowest level since 1956. The Honda plant in Swindon closed in 2021, while the Ford engine plant in Bridgend closed the year prior.
Britishvolt, which had planned to construct a "gigafactory" battery plant near Blyth, went bankrupt in January. The company has been acquired by the Australian company Recharge Industries, but the production of batteries for electric vehicles is no longer anticipated to be its primary focus. However, new investments are planned.
Ford is preparing its Halewood plant to produce electric vehicle motors by investing £380 million. Stellantis is preparing its Ellesmere Port factory in Cheshire to produce electric vans as part of a £100 million government-funded initiative.
A comparable amount of government funding will go towards the construction of a gigafactory adjacent to Nissan's plant in Sunderland, where the electric Leaf is manufactured.
A senior Nissan executive cautioned last month that continued government support and a reduction in manufacturing costs would be required to justify the production of additional electric models in this country.
Ashwani Gupta, chief operating officer, stated that the economics must work. As conventionally powered models are phased out, the government is reportedly eager for the United Kingdom to secure a stake in the emerging electric car industry.
The £75 million offered to BMW is provided by the government's Automotive Transformation Fund. It is believed that the government is in discussions with Tata, the parent company of Jaguar Land Rover, regarding a funding package for a potential gigafactory here.
Nevertheless, Spain is also believed to be competing for this investment.