The move is a welcome one for Britain as it negotiates a divorce from the European Union that some fear will dampen investment.
Sapa will provide lightweight aluminium from a factory in Wales for the electric taxis, which are due to be launched this year by Chinese company Geely's (>> Geely Automobile Holdings Ltd) The London Electric Vehicle Company, Sapa said on Monday.
Geely opened a new factory in central England in March to produce the electric black cabs.
It joins a trend by automakers to mass-produce electric vehicles, spurred on by government crackdowns on emissions, falling battery costs and the increasing range of electric cars.
By using aluminium, automakers can achieve weight savings of up to 50 percent compared with steel and improve the energy efficiency of vehicles.
Sapa, the world's biggest aluminium extrusion producer, closed a slew of factories including the Welsh one in 2014 due to excess capacity. Extrusions are formed by forcing heated aluminium through a steel die to create components.
"This was the first plant we had to sacrifice, but it is also the first one to be reopened," John Thuestad, Sapa's head of extrusions for Europe, told Reuters.
"The auto sector is only 15 percent of our (global) business, but it is currently driving the majority of our growth."
Sapa will invest 9.6 million pounds to revive the aluminium plant in Bedwas, Wales, which will produce 148 components and eventually employ 130 workers.
The company, owned by Norway's aluminium group Norsk Hydro (>> Norsk Hydro), designs and produces products from aluminium for sectors ranging from construction to aerospace and autos.
The London Electric Vehicle Company, previously the London Taxi Company, has said it aims to produce about 10,000 vehicles a year for British and overseas markets.
From January, all new cabs in London have to be zero-emissions capable, meaning they cannot be diesel and must be either fully electric or hybrid, according to rules introduced by the mayor of London.
Sapa already provides aluminium to carmakers in Europe, including Britain's biggest carmaker Jaguar Land Rover (>> Tata Motors Limited).
"Our plant is geared up to support the booming automotive industry in the UK and we see the trend absolutely continuing towards aluminium as a solution for their lightweighting challenges," said Barnaby Struthers, Sapa's business development manager in Britain.
(Reporting by Eric Onstad; editing by Susan Thomas)
By Eric Onstad