Dyson employs 1100 people in Singapore where they already make electric motors.
Jim Rowan, chief executive at Dyson, said: “We will begin construction in December and it will be completed in 2020, meeting our project timeline.”
Once the construction of the factory is complete the production of the vehicles is scheduled to start in 2021.
It plans to invest £2 billion into the project, one half of this investment will go towards investing into battery technology and the other half will be used in the development and construction of the vehicle.
Dyson is currently choosing their winner for the James Dyson Award 2018. Sustainable proposals include potato plastic, a bamboo straw and autonomous charging device powered by renewable energy.
The UK Dyson award winner was an O-wind turbine that is spherical in shape and takes advantage of horizontal and vertical winds. This differs from a traditional wind turbine that can only capture wind travelling in one direction.
James Dyson, founder of Dyson, said: “Young design engineers have the ability to develop tangible technologies that can change lives. The James Dyson Award rewards those who have the persistence and tenacity to develop their ideas.”