A £1.8m legacy fund from Ford Motor Company which was set up after it closed its Bridgend engine plant in 2020 will support a low-carbon vehicle project.
The Ford Low Carbon Vehicle Transformation Fund will support Caerphilly-based Deregallera to start work on an alternative motor for electric vehicles that's less harmful to the environment.
It is one of the first projects to receive the Ford funding and will see the advanced R&D firm work with Cwmbran-based Meritor and academics at Cardiff University to design, develop and test a new low-carbon electric vehicle motor which uses fewer "rare earth" materials, making them more cost effective and better environmentally.
If successful, the project will work towards the Welsh Government's ambitious net zero commitments.
The fund was established as a goodwill gesture by Ford after it closed its Bridgend engine plant in September. The Welsh Government encouraged the company to leave a legacy and will administer the funding.
It was set up to help address strategic technical challenges associated with low-carbon vehicles.
Applications for the second round of the Ford funding will open on Monday 1st August 2022.
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Economy Minister, Vaughan Gething said: "The Welsh Government is committed to building the new industries of the future here in Wales. These are the businesses that will create the new green jobs we need to secure a sustainable and prosperous Welsh economy.
"The record-high temperatures we experienced earlier this week is a clear demonstration that climate change is a threat to society. That’s why the Welsh Government has declared a climate emergency.
"As part of the action we’re taking, we’re committed to decarbonising our society, including developing transport systems that do not harm the environment. We need more electric cars, buses, and cleaner trucks on our roads. As a globally responsible nation, we also want to look after nature and make sure we do not squander finite global resources like “rare earth” materials.
"As part of the Welsh Government’s commitment to innovation, we want to see Welsh companies and academics come together to find innovative made-in-Wales solutions to global problems. So, I am delighted we have been able to fund this exciting new project, which delivers on that ambition.
"I am excited by the potential of this project to deliver an alternative vehicle motor that is sustainable. This could deliver significant benefits to our economy and our society. I am confident this will lead to the creation of new innovative, all-Welsh supply chains that will help power our economy long into the future."
Martin Boughtwood, managing director of Deregallera said: "Support from the Ford fund will enable us to continue to work with electric powertrain experts at the Cwmbran-based firm Meritor and Cardiff University to design and test a new motor which uses less “rare earth” material than conventional motors, making them cheaper and minimising environmental and climate impacts."
A spokesperson from the Ford Motor company said: "This is exactly the sort of innovative technical collaboration we wanted our legacy fund to support. The fund will provide a kick-start to two other low carbon vehicle projects in Wales, and we can’t wait to see what the next round of funding will bring."
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