Funding, Support and Investment
The UK automotive sector is undergoing rapid transformation, driven by the transition to zero-emission vehicles, advanced manufacturing, and supply chain innovation. Several funding programmes and support mechanisms are in place to help businesses of all sizes seize new opportunities, scale up, and remain globally competitive. Below is a summary of the principal funding streams and resources available.
DRIVE35 (Driving Research & Investment in Vehicle Electrification) is the UK Government’s flagship £4 billion, 10-year investment programme for the automotive sector, launched in July 2025. It is designed to accelerate innovation, scale-up, and transformation across the industry, supporting the transition to zero-emission vehicle manufacturing and advanced supply chain capabilities.
Funding schemes are delivered in partnership with the Department for Business & Trade, Innovate UK and the APC across 3 main pillars:
- Innovation: Focused on delivering SME growth and late-stage R&D projects across Mobile, Demonstrate and Collaborate competitions.
- Scale-Up: Funding opportunities to support businesses to scale-up from innovation to production, delivered across feasibility studies to validate the business and investment case, and the Scale-Up Fund to enable investment towards pilot scale
- Transformation: Capital funding for large-scale investments in zero-emission vehicle manufacturing, gigafactories, batteries, electric motors, and supply chain components, delivered through the Automotive Transformation Fund (ATF)
How to Apply: Competitions open at regular intervals throughout the year. Further information can be found via the Advanced propulsion Centre (APC) here.
As part of the 2025 Advanced Manufacturing Sector plan within the UK’s modern Industrial Strategy, £150 million is allocated towards the CAM Pathfinder programme, with targeted funding competitions designed to accelerate the development, deployment, and adoption of Connected and Automated Mobility (CAM) technologies across the UK.
Funding is available for feasibility studies, pilot projects, and technology demonstrators. The competition is jointly operated by Innovate UK, Zenzic, Advanced Propulsion Centre (APC) and the Department for Business and Trade. This complements the Automated Vehicles Act (2024), implemented by the Centre for Connected and Autonomous Vehicles (CCAV) within the Department for Transport.
Further details can be found here.
Building on the Faraday Battery Challenge, the Battery Innovation Programme, part of the UK Industrial Strategy and delivered by InnovateUK, is a £452m government investment up to 2030 to drive research, innovation and growth across the UK battery manufacturing sector.
The programme combines research and capability development through the Faraday Institute, collaborative R&D through InnovateUK, and manufacturing scale-up and skill development through UKBIC (UK Battery Industrialisation Centre)
The programme will launch in April 2026, with details to be published on the UKRI InnovateUK website here.
The UK government offers Research and Development (R&D) tax relief for applicable automotive SMEs.
Further details can be found on the UK government website here
Made Smarter Scheme (England)
The Made Smarter scheme is a UK government backed initiative to help UK manufacturing and automotive SMEs adopt digital technologies to boost productivity and growth. Match-funder grants are available alongside expert guidance, leadership and skills development support.
Made Smarter Adoption is open to small and medium-sized manufacturing and engineering businesses that have manufacturing premises in England.
Eligible businesses can register and apply via the Made Smarter UK website
Alongside government’s grant schemes and programmes, there are also a number of flagship government backed finance organisations that aim to support British businesses. These include:
Further UK Government Business Support
The are a wider range of schemes available from the Department for Business and Trade (DBT) to support businesses. Find out more here.
Businesses can also tap into the ‘one stop shop’ of government support via the Business Growth Service, available here.
There is also the Office for Investment which looks to coordinate large scale strategic investments
Businesses in Scotland, Wales, and Northern Ireland should contact their respective devolved governments for region-specific support programmes and funding opportunities.
In addition, companies within Combined Authorities may also be eligible for region specific programmes (notably in the West Midlands and the North-East of England).
This summary reflects the latest available information as of January 2026. For further information, businesses are encouraged to consult the Advanced Propulsion Centre, SMMT, and UK government or regional government websites.