Nissan is reportedly in talks to build a new EV battery factory in the UK.

The Japanese car maker already builds its Leaf electric car in Sunderland, with batteries built nearby at a factory operated by Chinese group Envision.

However, according to the Financial Times, Nissan is in talks with the Government to build a massive new site in the city which would make it the firm’s main EV production hub outside of Japan.

The site would produce up to 200,000 batteries a year when fully operational, according to the FT, with an output of up to 20GWh compared with the existing factory’s 1.9GWh.

The FT report claims that talks on the plans are at an “advanced” stage, with Envision expected to operate the site. However, neither Nissan nor the Government would confirm the story.

In a statement Nissan said: “Having established EV and battery production in the UK in 2013 for the Nissan Leaf, our Sunderland plant has played a pioneering role in developing the electric vehicle market.

“As previously announced, we will continue to electrify our line-up as part of our global journey towards carbon neutrality. However, we have no further plans to announce at this time.”

The Government has said it wants the UK to be a world leader in EV technology and is pursuing options to encourage manufacturers to site factories here. However, a spokesperson for the Department of Business, Energy and Industrial Strategy declined to comment specifically on any talks with Nissan, saying: “We are committed to ensuring the UK continues to be one of the best locations in the world for automotive manufacturing through a major investment programme to electrify our supply chain, create jobs and secure a competitive future for the sector.”

The Government is in talks with several other companies over the creation of so-called gigafactories in the UK, with the visit of Tesla CEO Elon Musk sparking rumours that the American EV firm might be considering a site in the country. Musk previously suggested Tesla might build a battery plant in the UK before the brand decided to site its factory in Germany.

Other plans for battery factories serving the EV market include a proposed scheme near Coventry and BritishVolt’s plans to convert the former Blyth Power Station in Northumberland into a facility that can produce batteries for up to 300,000 vehicles a year.

Sales of EVs are already rising – up 186 per cent in 2020 – and demand is expected to accelerate as the planned 2030 ban on new petrol and diesel vehicles approaches.

Nissan plans to launch its first electric SUV – the Ariya – later this year and many more mainstream car makers have plans to greatly expand their EV ranges this year.