Ryan FowlerThe UK Government has launched DRIVE35, a £2.5bn funding programme aimed at supporting the transition to zero-emission vehicle manufacturing and securing the future of the British automotive sector.
The initiative includes new and enhanced funding competitions covering transformation, scale-up, and innovation projects across the industry.
Announced as part of the Advanced Manufacturing Sector Plan under the UK’s modern Industrial Strategy, DRIVE35 comprises £2bn of capital investment through to 2030 and a further £500m in R&D funding available until 2035.
The programme will support companies of all sizes – from start-ups and SMEs to global manufacturers – working across the automotive supply chain.
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 as we deliver our Plan for Change.
“We’re taking action to back the industry for the future with the biggest set of announcements for the sector in the last decade.”
The Government also confirmed over £300m of funding for specific auto sector projects. This includes more than £100m in capital through the Automotive Transformation Fund (ATF), approximately £140m in joint Government and industry R&D support, and £18m through the Connected & Automated Mobility (CAM) Pathfinder programme.
Among the beneficiaries, Astemo Ltd. will invest over £100m in EV component production in Bolton, supporting more than 220 high-value jobs.
Dana is investing £15m in the West Midlands to support EV parts manufacturing, safeguarding over 100 skilled roles.
Mike Hawes, chief executive at the Society of Motor Manufacturers and Traders (SMMT), said: “The creation of this dedicated automotive programme is further evidence of the sector’s importance to economic growth. DRIVE35 has the potential to unlock investment and innovation in the UK, supporting jobs and creating wealth across the country.”
Ian Constance, CEO of the Advanced Propulsion Centre UK and Zenzic, added: “This new investment underlines the commitment from 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.”
DRIVE35 builds on the achievements of previous schemes such as the ATF and APC R&D competitions, which have already leveraged more than £6bn in private investment.
“The UK automotive sector generated £21.4bn in GVA in 2024 and currently employs 132,000 people.
