The Government has pledged to invest £2bn+ in UK automotive strategic manufacturing to ramp up production of zero-emission vehicles.

The investment will support the manufacturing, supply chain and development of zero-emission vehicles

The £4.5bn funding programme will see funding delivered to eight sectors key to economic growth, energy security and levelling-up.

This includes over £2bn earmarked for the automotive industry, supporting the manufacturing, supply chain and development of zero-emission vehicles.

Chancellor Jeremy Hunt said: “Britain is now the eighth largest manufacturer in the world, recently overtaking France. To build on this success, we are targeting funding to support the sectors where the UK is or could be world leading. Our £4.5 billion of funding will leverage many times that from the private sector, and in turn will grow our economy, creating more skilled, higher-paid jobs in new industries that will be built to last.”

Business and Trade Secretary Kemi Badenoch added: “The UK is a global hub for advanced manufacturing, with world-leading automotive, aerospace and maritime sectors. This package builds on recent investment wins, such as the £4bn gigafactory, and the £600m invested to build the next generation of electric Minis, and ensures that the government can continue to help create jobs, grow the economy, and secure the future of great British manufacturing.”

Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT), said the announcement was “an unequivocal vote of confidence in the UK’s critical automotive industry”.

“Coming on the back of almost £20bn committed by the sector in next-generation plants and technologies this year alone, it is indicative of the scale of investment such support can leverage and the result of substantial collaboration between government and the industry.

“This additional government investment reflects the fact the UK automotive sector has the talent, the innovation and the determination necessary to thrive in the face of fierce global competition. It will deliver benefits not just for the automotive sector but for the whole country in terms of growth, high-value jobs and productivity. It also sends a powerful signal that the UK is open for business.”

Commenting on the announcement, Mike Cafferky, head of OCU Evolution, the electric vehicle solutions business from OCU Group, said: “We want to see some clarity and consistency on policy around the role batteries will play in the net zero economy so we can invest well, both for us and for the wider UK economy. The launch of a ‘strategy’ suggests the government wants to demonstrate that it is baking long-term thinking into policy, which is crucial if we’re to reach net zero by 2050 or earlier.

“Certainly, when it comes to vehicles, the UK will struggle to decarbonise without the acceleration of the rollout of EVs across the country. We know that there are barriers to further take-up, such as charging infrastructure and cost, which is why a long-term vision is crucial so government, businesses and consumers can all play their part in cutting vehicle emissions.

“As we approach a general election year, there’s an exciting opportunity for a positive shift in energy transition. It’s a time to focus on the UK’s commitment to net zero. We’re eager to observe how the main parties prioritise the country’s long-term interests, demonstrating their dedication to sustainable progress over short-term gains. This is a chance to witness responsible leadership in action, uniting for a common goal.”