LONDON -- UK battery startup Britishvolt said it has secured a short-term investment to stay in business and staff will take a temporary pay cut while the company seeks longer-term funding for its planned gigafactory project in northern England.
Britishvolt did not name the investor.
The company said on Monday that it was mulling several options to provide “stability” after a report that the UK battery company may enter administration.
The company said on Wednesday that its almost 300 employees have agreed to an unspecified salary reduction for the month of November to further reduce short-term costs.
Britishvolt has outlined plans for a 3.8-billion-pound ($4.4 billion) 38 gigawatt-hour (GWh) plant in Blyth in England's industrial north to build electric vehicle batteries and earlier this year gained 100 million pounds in government backing - but which was payable further down the line after construction began.
The UK government under former Prime Minister Boris Johnson had touted Britishvolt's project as a major milestone toward building an EV industry as the country heads toward a ban on combustion engine cars in 2030.
But as of the summer, Britishvolt had only raised around 200 million pounds and had pushed back its production timeline citing "difficult external economic headwinds."
Rising interest rates and the risk of recession have made fundraising much harder for many startups.
"While the weakening economic situation is negatively impacting much business investment at present, at Britishvolt we are continuing to pursue positive ongoing discussions with potential investors," the company said in a statement on Wednesday.
"The result is we have now secured the necessary near-term investment that we believe enables us to bridge over the coming weeks to a more secure funding position for the future."
Last month, Bloomberg reported that Britishvolt was in talks to divest its 93-hectare (230-acre) lot in Cambois, northern England, to Slovak startup Inobat, citing sources who had asked not to be named as the discussions were confidential.
Auto executives have warned that without local battery production, much of Britain's car industry could shift overseas to be closer to where batteries are made.
Britishvolt had received backing from mining giant Glencore, which kicked off a funding round for the startup in February.
The battery company has also been working to develop batteries for British sports car brands Aston Martin and Lotus.
