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Just weeks after Britishvolt, the electric vehicle battery maker collapsed into administration, the British electric vans start-up Arrival is cutting 800 jobs globally as it continues to shift its focus to the US market.

Arrival, which operates factories in Banbury and Bicester, employs around 250 staff in the UK with the rest spread across the US, Germany, Russia and Israel. It has a global workforce of 1,600. It is unclear how many Arrival jobs are under threat in the UK.

The jobs cull was revealed this week alongside the announcement of the appointment of Igor Torgov as Arrival’s new chief executive.

Torgov, who joined the company last February, replaces interim chief Peter Cuneo, who stepped into the role in November when founder Denis Sverdlov, a Russian telecoms billionaire, stepped aside.

The company said the job cuts are part of plans to cut costs and expand its operations in the US where it hopes to take advantage of Joe Biden’s Inflation Reduction Act (IRA) which is offering $369bn in subsidies and tax credits for companies investing in electric vehicles and renewable energy technologies that are manufactured in the US.

In a statement the company said it is continuing to refocus its resources on the development of its US van product, with production expected to start in the US in 2024, subject to raising additional capital.

It added: “Following a detailed review of its operations and its markets, Arrival is now announcing immediate actions to further reduce its operating costs and to optimize the deployment of its current cash resources.

“This includes the difficult decision to reduce its global workforce by approximately 50% to 800 employees. When combined with other cost reductions in real estate and third-party spending, the company expects to halve the ongoing cash cost of operating the business to approximately $30m per quarter.

“Public road trials in the UK of the first certified and registered vans are ongoing.”

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Commenting on Igor’s appointment, Denis Sverdlov, founder and chairman of the Board said: “We are delighted that Igor will be stepping up as chief executive. His considerable experience executing business strategies in operations, manufacturing, supply chain, business systems and IT and his detailed knowledge of Arrival’s business made him the ideal candidate and will enable him to hit the ground running.”

Torgov said he was taking on his new role at a critical point in Arrival’s journey. He added: “Arrival has developed unique technologies in a market that has huge growth potential and can play a key role in addressing climate change. To unlock these opportunities, we need to make difficult decisions and to take swift action.

“Following a detailed evaluation of Arrival and the wider EV market during the past two months, the leadership team and the board have taken decisive action to ensure the most effective use of our current resources and optimize the efficiency of the business.

“The actions support our journey to become a champion in innovative products and new, more efficient methods of vehicle production, particularly in the important US market for commercial electric vehicles.

“We are keenly aware that these decisions, while necessary, will have a profound impact on a significant number of our colleagues. We are 100% committed to supporting our employees during this difficult process.”

Reacting to the news, Tristan Thomas, chief executive and co-founder of Packfleet said: “Arrival’s shift to the US comes as a real blow to the UK’s electric vehicle manufacturing industry. It’s a shame to be losing our EV capabilities here in the UK, especially at a time when we need to be accelerating the green transition. With the expansion of the ULEZ on the horizon and the sale of new ICE vehicles set to be banned by 2030, the UK is in desperate need of electric vehicles – especially vans.

“Logistics businesses across the country are competing to get their hands on new vehicles, and that presents a great opportunity for British-led EV manufacturers to capitalise upon. Courier companies are currently reliant on shipping vehicles in from abroad, and the industry would benefit hugely from a strong set of UK-based manufacturers.

“All-electric fleets will become ther norm in the next few years, and we need a manufacturing sector to keep pace and match demand.”

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