Black cabs
The London Taxi Company has opened a £300m factory in Coventry to make electric taxisGetty

The London Taxi Company (LTC) has opened a £300m factory in Coventry to make electric taxis. The plant will make up to 20,000 state-of-the-art TX5, a zero emissions taxi, a year, creating around 1,000 jobs at the Ansty Park site. It will also make other hybrid vehicles.

The government is spending £80m to support the project, which has gone towards building the plant, and will help fund the installation of electric charging stations around the UK.

The Department for Transport will also give taxi drivers up to £7,500 off the price of a new electric cab. It added that drivers who switch to these new taxis could save up to £2,800 in fuel costs a year.

The new electric taxi will go on sale in London towards the end of 2017, and then worldwide in early 2018.

Business and energy secretary Greg Clark said: "Our iconic black cabs are famous across the world. The London Taxi Company's impressive new factory and research and development facility showcases the innovation that makes the UK a world leader in the development of new automotive technologies."

From January 2018 all black cabs sold in the UK must be able to drive using electric technology, in efforts to improve the air quality of major cities, particularly the capital.

However, replacing the existing UK taxi fleet is expected to take many years, as the 38,000 taxis in operation in the UK only require replacing after around 15 years of service. Around 23,000 black cabs, which run on diesel, are in use in London.

LTC is owned by Chinese carmaker Geely, which also owns Volvo. It bought the UK firm in 2013 when it faced falling into administration.

The taxi-maker sells cabs to over 40 countries around the world, including Australia, China, France, Germany, Italy, Japan and New Zealand.

LTC chairman Carl-Peter Forster said the site is: "The first brand new automotive manufacturing facility in Britain for over a decade. The first dedicated electric vehicle factory in the UK, and the first major Chinese investment in UK automotive."

As part of the government's package it will provide 550 electric charging points in ten cities including London, Birmingham, Dundee, Coventry and Wolverhampton