The company now has a team of more than 400 people working on the project, including Dyson's own engineers and "talented individuals from the automotive industry".
Dyson added that his auto would look "radical and different" compared to vehicles now on sale - an advantage electric cars have over internal combustion, due to the compact size of electric motors and their lesser need for cooling.
The announcement could stoke debate in Australia over the subsidisation and slow adoption of electric cars.
"We finally have the opportunity to bring all our technologies together in a single product", Dyson said.
The important thing here is that the vehicle won't be "aimed at the mass market", meaning that Tesla can possibly expect some competition, but don't expect Dyson's new car-if it ever gets built at all-to be the silver bullet for the rest of us.
Dyson has been investing in battery technology for several years.
The founder said Dyson was going public with its project now - even though it does not expect to be able to deliver a vehicle to its first customers until 2020 or early 2021 - because secrecy around the project was constraining its ability to do deals with auto parts suppliers for the new vehicle and also hampering recruiting. "What we're doing is quite radical", he said.
No prototype has been built so far but the company believes it'll roll out electric cars in 2020. Rumors of Dyson's interest in electric vehicles have been swirling for years, and the company recently hired executives from both Aston Martin and Tesla.
The Financial Times reports £1bn will be spent on the vehicle's solid-state battery, with a further £1bn being spent on design and construction of the auto.
It is understood that a designer from Tesla has also been wooed to Dyson. Hopefully, we'll get more information in the next year or two. Dyson has pumped £2.5 million into AI development, which also buoys its robot cleaner ambitions.