The UK government said on November 17 that it would provide £4.5 billion in funds to support British manufacturing in order to boost investment across the country in eight industries, including the vital EV industry. The sector will have longer-term confidence regarding their investments thanks to the money, which will be accessible for five years starting in 2025.
The British automotive industry has been allocated almost £2 billion, while the aerospace sector has been allocated £975 million. These funds will assist the production, supply chain, and research and development of zero-emission vehicles, as well as investments in energy-efficient and carbon-free aviation equipment.
In addition, the government has committed £520 million for life sciences manufacturing to boost resilience against future health emergencies and leverage the UK’s world-class research and development, and £960 million for a Green Industries Growth Accelerator to support the production of clean energy.
Purpose of UK’s investment in EV
This funding is intended for the UK’s strongest, globally leading sectors, including those where the industry is undergoing fundamental changes to stay at the forefront of the global transition to net zero, like the move to zero-emission vehicles in the automotive industry. The manufacturing sector as a whole accounts for over 43% of all UK exports and employs approximately 2.6 million people.
The funding is a component of Prime Minister Rishi Sunak’s commitment to expanding the economy and his emphasis on long-term planning, which ensures that the funding looks beyond the most prosperous sectors of the economy today and considers how we can maintain our competitiveness internationally and develop the UK’s expertise for the industries of the future.
“The announcement is an unequivocal vote of confidence in the UK’s critical automotive industry,” stated Mike Hawes, Chief Executive of the Society of Motor Manufacturers and Traders (SMMT). Following the industry’s nearly £20 billion commitment to next-generation facilities and technology this year alone, it is a testament to the magnitude of investment that such assistance can leverage and the outcome of significant industry-government engagement.
The UK automotive industry has the talent, inventiveness, and willpower to prosper in the face of intense international competition, as seen by this extra government investment. It will help the entire nation in terms of growth, high-value jobs, and productivity—not just the automobile industry. Additionally, it strongly suggests that commerce is welcome in the United Kingdom.
The manufacturing sector in the automotive industry generates £78 billion in revenue, adds £16 billion in value to the UK economy, and invests approximately £3 billion annually in research and development. The automobile manufacturing business employs around 208,000 people directly and approximately 800,000 in the broader economy. The industry is a worldwide trader, accounting for 10% of all UK goods exports with £94 billion in exports.
“The UK is a global hub for advanced manufacturing, with world-leading automotive, aerospace, and maritime sectors,” stated Business and Trade Secretary Kemi Badenoch. This package guarantees that the government can continue to support job creation, economic growth, and the survival of great British manufacturing. It builds on previous investment wins, such as the £4 billion gigafactory and the £600 million invested to develop the next generation of electric Minis.
