- Four in five automotive businesses more likely to invest in
UK RD&I and commercialisation with stronger government
support and lower costs, new research shows.
- UK already a global hotbed for auto RD&I with £5.3bn
invested annually and zero emission and self-driving vehicle
rollout offering fresh opportunities.
- Scaling up to commercial production named biggest growth
barrier, with targeted support and energy reform needed to unlock
investment and jobs.
Britain could turn its automotive innovation strengths into fresh
investment, high value jobs and growth with targeted government
support and lower business costs, according to a new report
published today by the Society of Motor Manufacturers and Traders
(SMMT).1 Four in five (83.9%) automotive businesses
surveyed would be more likely to begin or expand UK research,
development and innovation (RD&I) investment over the next
five years with four in 10 (38.7%) significantly more likely
under these conditions.2
The report, Turning Automotive Innovation into UK Investment,
highlights substantial untapped growth potential in a sector
already investing £5.3 billion annually in the UK. From EV
batteries and motors to lightweight materials, self-driving
software, AI and cybersecurity, automotive innovation offers
opportunities to develop British products and services for
customers around the world.
The UK starts from a position of strength. Nearly three quarters
(74.2%) of respondents identified its talent pool as a key
advantage for UK-based automotive RD&I, alongside government
funding support (52.5%) and collaboration with world-class
universities (58.0%).3 These capabilities provide a
strong foundation to develop new technologies shaping cleaner,
safer and more connected mobility.
Crucially, the opportunity now extends beyond research and
development. By supporting the UK's flourishing auto RD&I
sector to grow in Britain and bring new products to market,
significant commercial value would be retained securing new
production opportunities, stronger supply chains and skilled jobs
nationwide. With four in five of the UK's 24 auto R&D centres
operating in industrial hubs outside of London and the South
East,4 growth is also likely to extend across the
country.
Realising this opportunity, however, requires making the UK a
globally competitive location, not just for developing business
ideas, but also for commercialising them. Given respondents
identified the difficulty of scaling their new tech from the
'lab' to commercial production in the UK as the biggest barrier
to growth,5 a stronger route to market is needed else
Britain risks seeing new tech developed here generating
investment and economic benefits elsewhere.
Ahead of the UK's 10 Year Plan due for next year's Spending
Review,6 SMMT is urging government to prioritise a
targeted, multi-year pathway to support early-stage auto RD&I
into its next phase of growth demonstration, pilot manufacturing
and scale-up expanding the sector's existing investment. Lower
industrial energy costs and faster grid infrastructure delivery
would further enhance the UK's proposition, particularly for
energy-intensive advanced manufacturing transforming the
country's natural innovation strengths into commercial value,
industrialisation and skilled jobs fit for the future.
Mike Hawes, SMMT Chief Executive, said, "British
ideas should create British jobs and growth, as well as global
opportunities. Our automotive engineers, businesses and
universities are developing technologies the world needs, and
this research shows a clear appetite to invest more here. But our
globally renowned innovation capabilities are only half the
opportunity we must also make the UK a place where ideas are
turned into production. Long-term funding, access to growth
finance, and competitive energy costs can turn British
breakthroughs into thriving businesses and exports, securing more
of the economic benefits here in the UK rather than overseas."
