The blue beacon of an ultra-modern charging point stands out against the gloomy backdrop of a wintry morning in Newcastle.

The facility, tucked away in a car park, is one of 40 to be installed in the city and 619 across the region – part of a plan to make it a centre for the production, supply and use of a coming wave of battery-powered cars.

The region is also home to Nissan’s car plant in Sunderland, Britain’s biggest, where it is considering siting European production of its electric Leaf car, which it will begin making later this year in Japan.

In an attempt to sway its decision, the government last year extended Nissan loans and grants to help it finance a £200m-plus plant producing lithium-ion car batteries in Sunderland, now part of a new “low-carbon economic area”.

The government is trying to lure other carmakers to produce plug-in cars in Britain in an effort to ensure its industry captures a portion of a coming technological shift some analysts describe as a megatrend. However, Nissan is keeping its cards close to its chest.

Trevor Mann, Nissan’s UK boss, says the company has nearly finished studying what it would cost to make the car, and a decision “could be imminent”.

The company needs to decide where to produce the Leaf by June in order to give enough lead time for the planned production launch of the car from mid-2012 in Europe.

Mr Mann says the company might also choose to build the Leaf at its Barcelona plant, at a Renault plant in Flins, France, or even import the car from Japan. Nissan is also building a battery plant in Portugal, whose government is also promoting electric cars.

While Nissan will make its choice largely based on considerations such as logistics and availability of parts, it is also weighing Britain’s commitment to support infrastructure for electric cars.

That is where initiatives like Newcastle’s come in. “We are trying to build an ‘X’ factor on top of what government can legally offer,” says Colin Herron of One North East, Newcastle’s regional development agency.

One North East is also building a £10m training college for “green-collar jobs” in areas such as fuel-cell or battery development near Nissan’s plant, where a disused test track will be available as an open-access facility for low-emission vehicles.

The lavish pump-priming for a class of cars that have not even hit the road in significant numbers underscores the steep barriers to mass-market acceptance.

“The drawbacks and barriers to electric vehicles are still such that it will remain quite a limited market for years to come,” says Al Bedwell of the consultancy JD Power. He estimates that pure electric cars will make up no more than 5 per cent of the European market in 2017.

Alongside Nissan, the government has held talks with General Motors about bringing production of its planned Opel/Vauxhall Ampera electric car to its plant in Ellesmere Port, Merseyside.

However, Nick Reilly, GM’s European boss, has said the company needs to undertake more work to understand plug-in cars’ potential sales volumes before deciding when to start building them in Europe.

India’s Tata Motors, which owns the luxury marques Jaguar and Land Rover, plans to produce an electric version of its Indica Vista small car somewhere in the UK.

BMW is already building most of the Mini E – the sub-brand’s pilot electric model – at its plant in Oxford, except for the electric motor, which comes from Munich.

Copyright The Financial Times Limited 2018. All rights reserved.

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