The Government has confirmed £65 million in fresh public funding for firms producing zero-emission vehicles, part of a wider £130 million package designed to accelerate UK electric vehicle technology and support around 1,800 jobs.
Of the public funding, £50 million will go towards helping car manufacturers and research partners scale up EV production, while £47 million has been earmarked to back smaller battery innovation projects. The investment is being matched by the automotive industry, taking the total package to roughly £130 million.
The money sits within the Government’s £4 billion Drive35 programme, the wider strategy aimed at speeding up the electrification of the UK car industry. Recipients include a consortium led by Bentley alongside Nissan, whose share of the funding is focused on self-driving car technology.
Industry minister Blair McDougall framed the investment as central to keeping vehicle manufacturing in Britain: “Britain invented the modern motor industry and we’re determined to ensure the next generation of vehicles are designed and built here too. This investment will secure skilled jobs, strengthen our manufacturing heartlands and help drive the reindustrialisation of Britain.”
The announcement lands against a backdrop of growing tension between the Government and the motor industry over the 2030 phase-out date for new petrol and diesel car sales. Recent reports have suggested ministers are considering softening the target amid cost-of-living pressures, with former prime minister Keir Starmer reportedly overruling energy secretary Ed Miliband on the mandate back in June. A government spokesperson has nonetheless insisted the administration remains committed to the 2030 deadline.
Not everyone is convinced the funding goes far enough to offset the pressure the mandate is putting on manufacturers. Conservative shadow business secretary Andrew Griffith was blunt in his criticism: “When it comes to the automotive sector this government is all handbrake and no accelerator. Despite U.K. car making at a 70 year low, ministers insist on an idiotic 2030 ban on combustion engines whilst forcing British car makers to pay billions subsidising Chinese EV competitors.”
The UK automotive sector generates roughly £25 billion for the economy and directly supports 183,000 jobs — figures that help explain why funding rounds like this one keep recurring. This latest package follows £77 million committed to zero-emission vehicle projects back in May 2023 and £89 million for EV technology in October 2023, suggesting a pattern of regular top-ups rather than a one-off intervention. Whether £130 million is enough to reassure an industry warning of job losses regardless of investment remains to be seen.
Kia UK posts best-ever July as EV3 and PV5 drive record sales — a reminder that despite the political noise, EV demand on the ground continues to grow steadily.
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