The UK Government has unveiled a bold £2.5bn investment in electric vehicle manufacturing, set to transform the British automotive industry and cement the UK’s leadership in zero-emission mobility.
Central to this plan is the launch of DRIVE35, a ten-year programme supporting innovation, infrastructure, and job creation across the sector.
This comprehensive investment package aims to future-proof the UK’s automotive industry by accelerating the shift to electric vehicles (EVs), supporting a wide range of projects from large-scale gigafactories to start-ups developing breakthrough technologies.
Commenting on the landmark investment, Business and Trade Secretary Jonathan Reynolds said: “We’re helping British carmakers get to the front of the pack by working hand in hand with investors to build a globally competitive electric vehicle supply chain in the UK.
“We’re taking action to back the industry for the future with the biggest set of announcements for the sector in the last decade.
“This includes securing a landmark trade deal with the US to bring down tariffs for British car manufacturers, measures in our modern Industrial Strategy to lower electricity prices, and updating the ZEV mandate, supporting UK manufacturers to safeguard jobs, and secure the future of the sector.
Introducing DRIVE35: A decade of innovation
Announced as part of the Advanced Manufacturing Sector Plan, DRIVE35 will direct £2bn to electric vehicle manufacturing and infrastructure by 2030, alongside £500m dedicated to research and development through 2035.
Built on the success of earlier schemes like the Automotive Transformation Fund (ATF) and the Advanced Propulsion Centre (APC), DRIVE35 will expand the reach and scale of previous initiatives.
These earlier programmes helped leverage more than £6bn in private sector investment and created thousands of jobs across the UK.
DRIVE35 will streamline support into three key pillars:
- Transformation: Supporting capital investments in facilities and technologies for zero-emission vehicle manufacturing.
- Scale-up feasibility: Funding strategic studies to grow early-stage projects into large-scale operations.
- Innovation competitions: Backing early and late-stage R&D to keep the UK at the cutting edge of EV technology.
Ian Constance, CEO, Advanced Propulsion Centre UK and Zenzic, added: “This new investment underlines the commitment from the government to secure advanced manufacturing in the UK.
“I am pleased that the APC, Zenzic, and its delivery partners are here to facilitate a new wave of funding in the automotive industry, supporting innovation, driving scale-up, and enabling transformation.
“We have announced projects receiving four types of grants that boost the UK’s leadership in automotive manufacturing. They will enable the rapid development of demonstrators featuring cutting-edge technology, accelerate ambitious SMEs, and support vital collaborative R&D innovation.
“This will encourage further investment in the UK’s growing zero-emission supply chain, safeguarding skilled jobs, and building on the country’s reputation as a world-leader for technology.”
Sector-wide impact: From prototypes to EV production lines
DRIVE35 is designed to benefit automotive companies of all sizes, from global OEMs to ambitious UK start-ups. Successful applicants will receive targeted funding to scale projects, secure jobs, and cut emissions.
The government has confirmed that the first set of competitions under DRIVE35 will open immediately, offering opportunities for capital investment, feasibility planning, and R&D collaboration.
In addition, the Department for Business and Trade announced £300m in new investments supporting specific firms and innovations. Highlights include:
- £100 million+ from Astemo Ltd. for EV component production in Bolton, creating over 220 high-value jobs.
- £15 million from Dana in the West Midlands to manufacture essential EV parts, supporting over 100 skilled roles.
- £18 million from the new £150m Connected & Automated Mobility (CAM) Pathfinder programme.
These investments aim to generate tens of thousands of jobs, unlock billions in private investment, and support the production of millions of zero-emission vehicles.
£63m boost for EV infrastructure
To supercharge the UK’s EV charging network, the government has also announced a £63m investment aimed at making EV ownership more affordable and accessible.
A £25m scheme for local authorities will help households without driveways install affordable at-home charging via innovative cross-pavement cable technology. This could save families up to £1,500 a year compared to petrol or diesel costs.
The initiative complements the Local EV Infrastructure Fund and £6bn in private sector commitments, expected to deliver an additional 100,000 chargepoints by 2030.
Greening the NHS: £8m for ambulance electrification
In a landmark move for public services, the NHS will receive £8m to support the electrification of its vehicle fleets. Over 1,200 charging sockets will be installed across 200 NHS sites, leading to major long-term savings on fuel and maintenance.
This initiative not only supports environmental goals but also helps redirect millions in cost savings back into patient care, aiding the NHS’s broader sustainability and efficiency ambitions.
Better signage and business support
To help EV drivers more easily access the expanding network, new road signage will be rolled out to mark charging hubs on A-roads for the first time.
The number of major charging hubs has more than doubled since 2023, and clearer signage is expected to make long-distance EV journeys more convenient.
In parallel, the government is launching a new grant scheme to assist businesses in installing depot-based charging for vans, coaches, and HGVs, supporting the wider commercial transition to zero emissions.
Future-proofing the UK auto industry
With the automotive sector contributing £21.4bn in gross value added (GVA) and employing over 132,000 people in 2024, DRIVE35 represents a transformative opportunity.
The UK Government’s long-term backing aims to position the country as a global hub for electric vehicle manufacturing, innovation, and export.
By combining public funding with private investment, fostering cutting-edge R&D, and scaling essential infrastructure, the UK is poised to lead the world in the race to a zero-emission future.
