The Government has taken back a substantial grant from Dyson after the company pulled the plug on its electric car project.
The vacuum cleaner and hair dryer manufacturer was originally awarded the funding as part of the UK’s 2016 National Infrastructure Delivery Plan.
The company received £7.8 million from the Government and was allocated a £17.5m facility for research and development of the technology.
At the time, the Government said it expected the grant would “secure £174m of investment in the area, creating over 500 jobs, mostly in engineering”.
Dyson said it planned to spend as much as £2.5 billion in developing electric vehicles and would develop its own motor from scratch that would be unique to its competitors. “No point in doing one that’s like everybody else’s,” it said.
Two years later the company announced it was scrapping the project, which it said was no longer commercially viable, but said it would instead focus the money on developing its battery tech and growing its education facility.
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Inventor and company head, Sir James Dyson, emailed the division’s 500 UK employees to say that the company had been unable to find a buyer for the project.
The company announced it would be closing its two electric car factories – one in the UK and the other in Singapore.
Following a number of talks between the company and ministers, the department for Business, Energy and Industrial Strategy announced “the funding support has been repaid in full”.
Although it is believed the company was entitled to keep a portion of the funding under the terms of the grant agreement, Dyson instead opted to pay it back.
A Dyson spokesman said: “When our automotive project closed, we contacted the Department for Business, Energy and Industrial Strategy and repaid the money.”