Competitions open on £2.5bn DRIVE35 automotive funding journey

13 July 2025

• Funding announced by the Department for Business and Trade
• Three main funding priorities:
  • Supporting innovation,
  • Accelerating scale-up
  • Enabling transformation
• Specialised grants facilitated by the Advanced Propulsion Centre UK are open now: Collaborate, Demonstrate, Scale-up Feasibility Studies, and Automotive Transformation Fund

The Advanced Propulsion Centre UK (APC) will continue to support the automotive industry by facilitating the latest government grant-funding announced.

Following the launch of DRIVE35 (Driving Research and Investment in Vehicle Electrification), the new Department for Business and Trade-led programme is aimed at transforming the UK’s automotive sector.

With over £2 billion available over five years, and a further £500 million for R&D to 2035, it will support research and development as well as the commercial scale-up of innovative zero-emission vehicle technologies.

On the DRIVE35 funding journey, the APC will offer several specialised government grants within the three main priorities, each with specific aims and eligibility.

The competition processes will open at regular intervals throughout the year, accessed through the APC and via the Innovate UK Innovation Funding Service (IFS).

The grants that are opening for applications today are: Collaborate, Demonstrate, and Scale-up Feasibility Studies, as well as expressions of interest for the new and improved Automotive Transformation Fund (ATF).

The APC is taking enquiries now to help companies prepare a project pitch and align it with the most suitable funding stream available through the DRIVE35 initiative. In full they are:

Supporting Innovation

Three funding streams are available, providing targeted funding and support at each step of the innovation journey:

Mobilise is an SME accelerator programme. Applicants receive up to £180,000 in grant-funding from DRIVE35, the Centre for Connected and Automated Vehicles’ (CCAV) CAM Pathfinder programme, and enjoy tailor-made business support from our in-house team.

Eligible for zero-emission vehicle-related technology innovations as well as connected and automated mobility (CAM) and automotive software.

This opportunity will open later in the year.

Demonstrate Grants are for companies that are in product or process development or need a short, sharp sprint to get where they want to be.

This enables companies to build a product or process demonstrator in under 12 months, and to have something tangible at the end to take to customers.

Demonstrate Grant funding is available up to £1.5 million, match-funded, for single entities or companies who want to form a group.

Collaborate Grants fund projects where companies form a consortium to take a product or process to commercial readiness. Academic institutions are also welcome to join the groups.

Successful applicants can receive up to £25 million to support the design, development, manufacturing, and delivery of strategic zero-emission vehicle technologies.

Both these opportunities, Demonstrate and Collaborate, are open for applications twice a year.

For the first time, the scope also includes automotive software (i.e. software defined vehicles), electrical and electronic architectures, and manufacturing competitiveness.

Demonstrate and Collaborate are open now – visit the APC website to find out how to apply

Accelerating Scale-up

New Scale-up Feasibility Studies will enable successful applicants to commercially validate the future growth and investment potential of their innovative technology.

Companies can apply for funding to deliver a feasibility study to assess the planning, investment  and business case for manufacturing projects, this can be across pilot scale, demonstration scale, full industrial scale facilities.

Once the business case has been validated, applicants can apply for the next steps of funding.

The Scale-up Fund is available to enable rapid growth and commercialisation. As soon as the funding is secured, a grant guarantee is issued to leverage external investment to generate additional cash-flow to enable faster scale-up. More information on this will follow soon.

Feasibility Studies are open for applications now

Enabling Transformation

The Automotive Transformation Fund (ATF) provides Government capital funding to support large-scale industrialisation and accelerate the transition to an electrified automotive supply chain.

This dynamic initiative will create high-value jobs, attract private investment, and drive emission reductions. The programme aims to develop the manufacturing capability of zero-emission vehicles and leverage the UK’s unique skills for high-growth domestic and export markets.

Expressions of interest to the ATF are also open now

On welcoming the Advanced Manufacturing Sector plan APC and Zenzic CEO Ian Constance said,

“This strategy aligns perfectly with our commitment to transform the automotive sector through innovative CAM and zero-emission vehicle technologies. By continuing to prioritise collaboration between industry, government, and academia, we can support research and development, vehicle innovation, and unlock capital investment in manufacturing plants and their wider supply chains.”

“This will not only bolster our economy but also address pressing environmental challenges, add resilience to critical supply chains, and support international trade and investment. We are excited about the opportunities this plan presents to position the UK as a global leader in advanced manufacturing and look forward to playing an integral role in delivering the Driving Research and Investment in Vehicle Electrification (DRIVE35) and CAM Pathfinder programmes.”