The UK government has revealed a £4.5 billion funding initiative aimed at bolstering the manufacturing sector. The investment, available from 2025 for five years, seeks to provide industry players with longer-term certainty for their investments. Key sectors set to benefit include automotive and aerospace, with over £2 billion allocated to the former and £975 million to the latter. The funding aims to support the manufacturing, supply chain, and development of zero-emission vehicles, along with investments in energy-efficient and zero-carbon aircraft equipment.
In addition to the sector-specific allocations, the government commits £960 million to a Green Industries Growth Accelerator to foster clean energy manufacturing and £520 million for life sciences manufacturing. The latter aims to enhance resilience for future health emergencies while capitalizing on the UK’s research and development strengths.
The initiative is part of the UK Prime Minister’s focus on long-term decision-making and building expertise for future industries. The funding is expected to unlock private investment, provide certainty to investors, boost energy security, and protect and create jobs. The announcement precedes the Global Investment Summit, highlighting opportunities in technology, sustainability, life sciences, advanced manufacturing, and creative industries.
The manufacturing sector constitutes over 43% of all UK exports and employs approximately 2.6 million people. The funding aims to support UK industries undergoing fundamental changes to remain at the forefront of the global transition to net zero.
Chancellor of the Exchequer Jeremy Hunt emphasizes that the £4.5 billion funding will stimulate economic growth, creating skilled, higher-paid jobs in industries poised for long-term success. Business and Trade Secretary Kemi Badenoch underscores the importance of supporting sectors where the UK can be world-leading, ensuring job creation and economic growth.
Industry responses have been positive, with Make UK, the manufacturers’ organization, welcoming the decision and highlighting the benefits for SMEs across the country. Mike Hawes, CEO of the Society of Motor Manufacturers and Traders (SMMT), sees the announcement as a vote of confidence in the critical automotive industry, capable of thriving amid global competition.
Overall, the funding initiative aligns with the UK’s commitment to decarbonization, fostering innovation, and supporting strategic industries in their transition to a sustainable future.