The UK government has launched a £2.5 billion, decade-long strategy to accelerate investment, innovation and job creation across the country’s automotive sector, as it races to lead the global transition to zero-emission vehicles.
Dubbed DRIVE35, the initiative is part of the UK’s modern Industrial Strategy and sets out a bold ambition to significantly increase advanced manufacturing investment by 2035. The programme will offer a suite of new and expanded funding competitions, targeting everything from large-scale EV gigafactories to innovative automotive start-ups and supply chain scale-ups.
Business and Trade Secretary Jonathan Reynolds hailed the initiative as “the biggest set of announcements for the sector in the last decade”, adding that DRIVE35 would give industry the certainty it needs to invest and grow in Britain.
“We’re helping British carmakers get to the front of the pack by working hand in hand with investors to build a globally competitive EV supply chain,” said Reynolds. “Economic growth is our number one priority, and this programme will help deliver it – with high-quality jobs, increased exports and a cleaner transport future.”
The government has committed £2 billion in capital support to 2030, with an additional £500 million for research and development to 2035, creating what ministers say is a long-term, globally competitive offer for investors and manufacturers.
The launch comes as Britain continues to lead in EV adoption: over 382,000 electric vehicles were sold in 2024, making the UK Europe’s largest EV market and third globally. With more than 82,000 public charge points now installed nationwide – and one added every 30 minutes – the infrastructure is already scaling to meet growing demand.
The automotive sector currently supports 132,000 UK jobs and contributed £21.4 billion in GVA in 2024. The government believes the transition to net-zero is the biggest industrial opportunity of the century – and one Britain is well placed to seize.
As part of the wider Industrial Strategy, the Department for Business and Trade also confirmed more than £300 million in direct support for key UK auto projects, including:
- Over £100 million in capital funding through the Automotive Transformation Fund to support UK-based EV manufacturing.
- £140 million in combined public and private investment in R&D across 50 projects, including partnerships with Mercedes and Jaguar Land Rover.
- £18 million under the new Connected & Automated Mobility (CAM) Pathfinder programme.
New investment announcements include:
- Astemo Ltd bringing £100 million to Bolton to develop next-generation EV inverters, creating over 220 high-value jobs and boosting regional supply chains.
- Dana, a Tier 1 automotive supplier, confirming £15 million to scale EV component production in the West Midlands, supporting over 100 direct roles.
Industry body SMMT and delivery partners including the Advanced Propulsion Centre (APC UK) and Zenzic welcomed the announcement.
“The creation of this dedicated programme is further evidence of the sector’s importance to economic growth,” said Mike Hawes, Chief Executive of SMMT. “DRIVE35 must now be implemented at pace to ensure the UK is amongst the leaders in next-generation automotive technologies.”
“This new investment underlines government’s commitment to securing advanced manufacturing in the UK,” added Ian Constance, CEO of APC UK. “It will support innovation, drive scale-up and encourage global investment in the UK’s growing zero-emission supply chain.”
Applications for the first round of competitions open tomorrow, with the government urging businesses across the country to seize the opportunity.