The United Kingdom has launched a bold new initiative designed to supercharge its automotive industry’s transition to electric vehicles.
With a pledge of £2.5 billion over the next decade, the government is introducing the DRIVE35 programme, a comprehensive funding scheme aimed at maintaining the UK’s position as a global leader in zero-emission vehicle (ZEV) development.
Announced as part of the Advanced Manufacturing Sector Plan, DRIVE35 includes £2 billion in funding through 2030, plus an additional £500 million for research and development extending to 2035. Officials say the initiative provides long-term certainty for manufacturers and innovators and is a cornerstone of the UK’s modern Industrial Strategy.
The funding is expected to support a diverse range of projects, from high-volume manufacturers and gigafactories to start-ups and prototype developers. According to the government, this ambitious investment will unlock significant private capital in ZEV technologies, batteries, and supply chains.
The UK’s automotive sector is already a major economic driver, contributing £21.4 billion in Gross Value Added (GVA) in 2024 and employing over 132,000 people across the country. The transition to zero emissions is seen as a transformative opportunity to attract investment, foster innovation, and generate economic growth for future generations.
As of 2024, the UK was the largest electric vehicle market in Europe and the third-largest globally, selling over 382,000 EVs, an increase of 20% from the previous year. With over 82,000 public charging stations already installed and new ones added every 30 minutes, the country is building a robust infrastructure to support widespread EV adoption.
Drive35 Plan Backs Auto Sector Innovation
Business and Trade Secretary Jonathan Reynolds underscored the government’s commitment to accelerating EV development.
“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 as we deliver our Plan for Change.”
Jonathan Reynolds
Reynolds described the new measures as the most significant support for the sector in a decade. This includes the recent UK-US trade agreement, which aims to reduce tariffs on British-made vehicles, updates to the ZEV mandate, and electricity cost reduction policies, all designed to solidify the UK’s status as a competitive player in the global automotive market.
“Economic growth is our number one priority, and by funding our world leading auto sector we are creating the right conditions for increased investment, bringing growth, jobs, and opportunities to every part of the UK,” Reynolds added.
DRIVE35 builds on the success of the Automotive Transformation Fund (ATF) and the Advanced Propulsion Centre UK (APC) R&D competitions. Together, these programs have already attracted more than £6 billion in private sector investment and created thousands of jobs.
In a further boost to the industry, the Department for Business and Trade announced over £300 million in funding for specific UK-based automotive projects. This includes over £100 million in capital investment through the ATF, around £140 million in joint government and industry research and development, and £18 million from the new £150 million Connected & Automated Mobility (CAM) Pathfinder programme.
Among the beneficiaries is Bolton, where Astemo Ltd. will receive over £100 million to produce next-generation electric inverters, supporting 220 high-value jobs and reinforcing the region’s role in the UK’s EV supply chain.
Meanwhile, the West Midlands will benefit from a £15 million investment by Dana, a company specializing in EV components. The project will help secure more than 100 skilled jobs in the region and strengthen the UK’s position in advanced automotive manufacturing.
The government’s multi-pronged strategy reflects its determination to lead in the global race toward a net-zero automotive future, positioning British manufacturers at the forefront of innovation and sustainability.
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