In his recent financial update to the House of Commons, Chancellor Jeremy Hunt has allocated £2 billion for the construction of electric cars in the UK. With an upcoming election expected within the next 12 months and scheduled by January 28th, 2025, this presented one of the chancellor's limited opportunities to enhance his party's chances for re-election by utilizing surplus funds generated from higher-than-anticipated tax income.
While no new measures for motorists were introduced, the chancellor revealed a £2 billion government fund aimed at fostering fresh investments in zero-emission vehicle manufacturing. He emphasized that this initiative would "ensure that the UK remains competitive" and suggested that major automotive players such as Nissan and Jaguar Land Rover would benefit from the financial boost. The allocated funds are set to be distributed over a five-year period starting in 2025.
Business secretary Kemi Badenoch expressed approval of the funding, noting that it builds on recent successes, including a £4 billion commitment from companies for a UK gigafactory producing electric vehicle batteries and a £600 million investment from BMW to manufacture the next generation of the Mini Electric in Oxford.
The government, wary of past failures, is determined to scrutinize new investments closely for viability. Notably, the Britishvolt gigafactory, which received around £100 million in 2022 for EV battery production, collapsed into administration in early 2023 due to missed funding targets.
The decision to produce the upcoming electric Mini in the UK hinged on a £75 million incentive from the government, with 3,000 jobs at stake and the risk of production relocating abroad.
Additionally, Jaguar Land Rover's parent company, Tata, disclosed plans to construct a new EV battery plant in Somerset as part of a £15 billion investment in zero-emission vehicles. The government has yet to disclose the amount of public funding promised for Tata's factory. In another announcement, the government extended a £150 million program researching self-driving vehicles until 2030, with pilot schemes operating nationwide.
For motor guidance please refer to our dedicated car brand buyer guides found HERE
Ready to turn your dream into a reality? Contact our dedicated motor finance team today at 01908 429888 or drop us an email at krish@approved-finance.co.uk or jessica@approved-finance.co.uk. 🏎💨