Dyson axes £2.5 billion electric car project

The company was originally due to unveil the new model in 2020, but the date had been pushed back a year

Inventor James Dyson has topped the Sunday Times Rich List despite an expensive failure to put an electric car into mass production. AP

Dyson, the British company mostly known for its vacuum cleaners, has scrapped a £2.5 billion project to build electric cars, after the founder had concluded it was not a commercially viable project.

In a statement, founder James Dyson said that the automotive team had developed “a fantastic car” but the vehicle was unlikely to be able to make money and failed to find a buyer.

Dyson was due to unveil the electric car in 2020, but last year, the date got pushed back to 2021 when it announced it would build a manufacturing plant in Singapore.

“The Dyson Board has therefore taken the very difficult decision to propose the closure of our automotive project,” Mr Dyson wrote.

Although the billionaire said “it was not a failure”, it represents a humbling U-turn: he has previously said that electric cars would redefine the company, after making public his its intentions to begin the project in 2017.

Mr Dyson told his company’s 4,500 staff that “most” of the 523 employees working on the electric car project would be redeployed elsewhere in the company.

“For those who cannot, or do not wish to, find alternative roles, we will support them fairly and with the respect deserved,” Mr Dyson wrote. “This is a challenging time for our colleagues and I appreciate your understanding and sensitivity as we consult with those who are affected.”

As well as vacuum cleaners, the company makes a range of other household items, including fans and hairdryers. It holds over 10,000 patents.

Mr Dyson said that the company would continue its £2.5 billion investment programme into new technology, including manufacturing solid state batteries, sensing technologies, robotics, machine learning and AI.

“Since day one we have taken risks and dared to challenge the status quo with new products and technologies,” Dyson wrote. “Such an approach drives progress, but has never been an easy journey – the route to success is never linear. This is not the first project which has changed direction and it will not be the last.

“I remain as excited about the future of Dyson as I have always been; our ambitions have never been higher, our ability to invest has never been greater, and the team has never been stronger.”

Dyson isn’t the only company with presence in the British automotive industry that has run into challenges this week. On Thursday, Nissan’s European chairman Gianluca de Ficchy warned that a no-deal Brexit could make its business model for the continent unsustainable. If a 10 per cent export tariff was introduced after the UK left the EU it would put its operations “in jeopardy”, he said.