Dyson cancels electric car project
Company faced mounting challenge from established carmakers
James Dyson has cancelled his company’s electric car project.
Dyson has abandoned its attempts to break into the automotive industry and will wind down its electric vehicle project, ending a venture that founder James Dyson claimed would redefine his business.
The company failed to find a buyer for its designs, and said its plans to build a car from scratch in Singapore were no longer commercially viable.
Dyson’s ambitions faced a mounting challenge from established carmakers, while electric vehicle makers such as Tesla have raised large sums on the stock and bond markets. Many new entrants such as China’s Nio have struggled with the cost of competing against deep-pocketed incumbents.
Sir James’s decision represents a humbling U-turn for a man who is one of Britain’s most celebrated living inventors. The billionaire businessman had hoped to harness his privately owned group’s expertise in battery systems, aerodynamics and high-tech manufacturing to break into a fiercely competitive industry.
“Though we have tried very hard throughout the development process, we simply can no longer see a way to make it commercially viable,” Sir James wrote in an email to staff on Thursday.
“We have been through a serious process to find a buyer for the project which has, unfortunately, been unsuccessful so far.”
Unveiled to great fanfare two years ago, Dyson had promised a “radically different” electric car that would have been the crowning achievement of a brand famous for its high-end domestic appliances.
The company even filed patents showing the potential shape of the vehicle, and Sir James said on Thursday the team had developed a “fantastic car”.
The failed automotive gamble was part of a £2.5 billion (€2.7 billion) investment push into a range of new technologies, including artificial intelligence and robotics and batteries. Out of that war chest, £1 billion was originally earmarked for the car and £1 billion for battery development.
However, automotive industry figures had questioned whether Dyson could shoulder the necessary investments needed to make a car from scratch. While major carmakers such as Volkswagen have committed billions to electric cars, and are able to sell battery cars at a loss, Dyson’s project was funded from its existing business.
Dyson did not disclose how much it had spent on the project, but said many of the developments for it, such as electric motors, would be deployed across the rest of the business, which ranges from air filters to its flagship vacuum cleaners.
The company has 523 employees on the project, of which 498 are based at a research and development centre on the site of a former Royal Air Force base in Hullavington, Wiltshire. Twenty-two are in Singapore, which was chosen over the UK as the location to produce the car.
Sir James said: “We are working to quickly find alternative roles within Dyson for as many of the team as possible and we have sufficient vacancies to absorb most of the people into our Home business.”
Sir James, who is a backer of Brexit, drew criticism earlier this year over Dyson’s relocation of its headquarters to the Asian city-state.
At the time, the company said the move was because its manufacturing operations and most of its customers were in the region but that it was not linked to the UK’s departure from the EU, nor for tax purposes. Another reason was to allow senior executives to oversee the construction of a car factory.
Despite culling the automotive project, Dyson’s main corporate office is expected to remain in Singapore.
Since it was founded in 1992, Dyson’s only significant commercial failure was its washing machine. Today the company employs 4,500 in the UK, out of a global workforce of 14,000, with a large research and development operation in Wiltshire. – Copyright The Financial Times Limited 2019