DRIVE35 Scale-up: Feasibility Studies

Key Features

UK registered businesses can apply for a share of up to £5 million for feasibility studies into UK manufacturing of zero emission vehicle technologies. This funding is from the Department for Business and Trade.

Programme:     Innovate UK

Award:     Share of up to £5 million

Opens: 14th Jul 2025

Closes: 3rd Sep 2025

Overview

DRIVE35 (Driving Research and Investment in Vehicle Electrification) is a Department for Business and Trade led programme aimed at transforming the UK’s automotive industry. This is achieved by supporting R&D and the commercial scale up of innovative zero emission vehicle technologies, and unlocking capital investment in zero emission vehicles, batteries and their wider supply chain.

Innovate UK, part of UK Research and Innovation, will work with the Department for Business and Trade (DBT) and the Advanced Propulsion Centre UK (APC) to invest up to £5 million in the DRIVE35 Scale-Up: Feasibility Studies competition.

This competition is part of a long-term commitment for driving growth sectors within the governments Industrial Strategy.

Scope

The aim of this competition is to support detailed feasibility studies into the deployment of UK based manufacturing facilities for zero emission vehicle technologies, such as:

  • pilot scale manufacturing
  • demonstration scale manufacturing
  • industrial scale manufacturing

Your proposal is expected to enable an investment ready business case, advancing your readiness for manufacturing at your targeted production maturity and volume.

Your project must:

Support growth, transition and resilience of the UK’s automotive supply chain by increasing capability whilst improving productivity, efficiency and competitiveness.

Contribute to the UK’s strategic aims and priorities, for example, the Industrial Strategy, and Automotive Council’s Roadmaps and Strategic Technology areas.

Undertake a feasibility study that develops a detailed plan, business case and investment case for creation or conversion of manufacturing facilities for eligible on-vehicle technologies (including zero-emission vehicle assembly and the associated supply chain).

Support the transition to zero emission vehicles and have the potential to create and safeguard high value jobs and create a lasting economic benefit to the UK.

Deliver a detailed closeout report and present at a closeout meeting with the APC. This is to review the business case, its outcomes and next steps, prior to closure and payment of the final claim.

Your project can enable you to:

Develop a plan for the build or conversion of manufacturing facilities in the UK, including:

  • your technical approach
  • your objectives
  • a detailed timing schedule

Create a flow sheet or layout of your manufacturing process or manufacturing facility.

Continue to develop robust commercialisation plans with a clear articulation on how the eligible technology will be commercialised or delivered to the automotive market at pace, from the UK and as a result of the project. This does not exclude spill over use in other sectors.

Produce detailed costing and financial models examining the costs of developing and operating your manufacturing facility and the incomes that it could enable.

Produce a business case for future investment which enables a decision:

  • to invest in the project in the UK

or

  • that clearly shows the potential barriers or challenges to doing so and the additional steps or measures to overcome these barriers

Develop the insight, plans and details required to show how you will secure investment in your manufacturing plan for the zero emission vehicle supply chain in the UK.

Technology scope

This competition aims to support feasibility studies, enabling investment into manufacturing of strategically important technologies for on board vehicle applications in one or more of the following areas:

  • electrical energy storage: development of batteries, supercapacitors, their components, management, and integrated systems
  • electric machines and associated driveline
  • power electronics including Vehicle to Everything (V2X)
  • internal combustion engine (ICE) for off road applications, we will fund project proposals that support a transition to zero emissions, utilising non fossil fuels
  • lightweighting materials and manufacturing processes
  • fuel cell systems and associated balance of plant
  • hydrogen storage and management systems
  • zero emission vehicle assembly

Within the technology scope outlined above, your project can include:

  • upstream supply chain for the technologies, including, raw materials, component manufacturing and subassembly manufacturing
  • circularity and design for disassembly: projects delivering manufacturing systems which enable the disassembly, remanufacturing, recovery and reuse of materials
  • the deployment of technologies, to enable productivity and cost competitiveness across the relevant aspects of applicable manufacturing operations in any of the following areas: digital transformation, manufacturing process decarbonisation and lean manufacturing

Digital transformation can include: integration of digital tools within the manufacturing process, for example, the use of AI, digital twins, and Internet of Things (IoT).

Manufacturing process decarbonisation can include: processes that use renewable energy sources or innovations enabling reduced energy consumption within manufacturing processes, including capture and reuse.

Lean manufacturing can include: implementation of innovative lean principles to improve efficient use of materials used in processes, reduce their environmental impact and improve efficiency including the use of advanced automation techniques.

Scope of activities

We recognise that companies in different segments of the zero emission vehicle supply chain use different terminology to describe their manufacturing development phases. Our intention with the wording of the competition is described below.

These are not suggested as absolute definitions, but instead as general categories to enable you to communicate the intention of your project:

  • pilot scale: scale up stage at which flexibility is key, utilised to develop initial production capability under real world conditions, whilst still maintaining significant flexibility for iterative improvements
  • demonstration scale: scale up to intermediate production scale that reflects a production representative manufacturing workflow, focusing on repeatability with lower flexibility than pilot, and often representing final stage of manufacturing validation before industrial scale production
  • industrial scale: full scale industrial production targeting high volume applications, deployed to fully realise the production volume potential for a product, utilising large scale industrial facilities, employing mass manufacturing techniques

You may use your established terminology to describe your project in your application, but you must explain this clearly with regards to your goals and stages of development.

Target market

You must develop business cases that take new technologies towards scale up, market entry and industrialisation. You must outline how your project will enable you to enter the following vehicle supply chain or markets:

  • On-highway vehicles, for example, L-category, motorbike, car, bus and truck applications
  • Off highway vehicles and non-road mobile machinery (NRMM), for example, construction, agriculture, mining and other off-highway applications

Where your business case enables entry into other markets, you must be clear how the project prepares your business for entry into one of these vehicle markets.

Eligibility

Your project must:

  • have total a grant funding request of between £150,000 and £750,000
  • last up to nine months
  • carry out all of its project work in the UK
  • intend to exploit the results from or in the UK
  • start by 1 January 2026
  • end by 31 August 2026
  • aim to utilise at least 44% of the grant budget by 31 March 2026

Your project must have a maximum of 50% grant funding for a large organisation, or 60% for an SME. For example:

  • if you are applying as a large organisation and asking for £300,000 in grant, your total eligible project costs need to be a minimum of £600,000
  • if you are applying as an SME and asking for £300,000 in grant, your total eligible project costs need to be a minimum of £500,000

Projects must always start on the first of the month, even if this is a non-working day. You must not start your project until your Grant Offer Letter has been approved by Innovate UK. Any delays within Project Setup may mean we need to delay your project start date.

You must only include eligible project costs in your application. See our overview of eligible project costs. For specific guidance, see the eligibility section in this competition.

Lead organisation

To work alone your organisation must be a UK registered business of any size.

More information on the different types of organisation can be found in our Funding rules.

Subcontractors

Subcontractors are allowed in this competition.

Subcontractors can be from anywhere in the UK and you must select them through your usual procurement process.

You can use subcontractors from overseas but must make the case in your application as to why you cannot use subcontractors from the UK.

You must provide a detailed rationale, evidence of the potential UK contractors you approached and the reasons why they were unable to work with you. We will not accept a cheaper cost as a sufficient reason to use an overseas subcontractor.

All subcontractor costs must be justified and appropriate to the total eligible project costs.

Number of applications

There are no restrictions on the number of applications on which an eligible organisation can lead. Successful applicants will be asked to confirm they have the capacity to run multiple projects simultaneously.

Sanctions This competition will not fund you, or provide any financial benefit to any individual or entities directly or indirectly involved with you, which would expose Innovate UK or any direct or indirect beneficiary of funding from Innovate UK to UK Sanctions. For example, through any procurement, commercial, business development or supply chain activity with any entity as lead, partner or subcontractor related to these countries, administrations and terrorist groups.

Use of animals in research and innovation Innovate UK expects and supports the provision and safeguarding of welfare standards for animals used in research and innovation, according to best practice and up to date guidance.

Any projects selected for funding which involve animals will be asked to provide additional information on welfare and ethical considerations, as well as compliance with any relevant legislation as part of the project start-up process. This information will be reviewed before an award is made.

You can use a previously submitted application to apply for this competition.

Exclusions

Innovate UK are not funding projects that:

  • request grant greater than 60% of total project costs for an SME or 50% for a large business
  • are focused on technology feasibility, technical research or technical product development
  • do not have a robust future plan to enter the zero emission vehicle supply chain
  • are not aligned with the UK Industrial Strategy
  • are focused on the development or production of low carbon fuels
  • are not of future benefit to the automotive sector
  • are focused on technologies or processes which are too technologically immature to scale with increasing market demand
  • are focused on fossil fuelled internal combustion technology
  • are focused on the production of hydrogen
  • are focused on off vehicle charging infrastructure
  • are focused primarily on the development of digital or data technologies
  • are focused on small personal mobility applications such as e-scooters, e-bikes, or other low powered mobility devices

Innovate UK cannot fund projects that are:

  • dependent on export performance, for example, giving a subsidy to a baker on the condition that it exports a certain quantity of bread to another country
  • dependent on domestic inputs usage, for example, giving a subsidy to a baker on the condition that it uses 50% UK flour in their product

Funding Costs

Up to £5 million has been allocated to fund innovation projects in this competition. Funding will be in the form of a grant.

If your organisation’s work on the project is commercial or economic, your funding request must not exceed the limits below. These limits apply even if your organisation normally acts non-economically but for the purpose of this project will be undertaking commercial or economic activity.

Your total grant funding request must be between £150,000 and £750,000 and no more than 60% of your total project costs if you are an SME, or 50% for large organisations.

The balance between your total project costs and the amount of grant awarded must be funded by the organisation receiving the grant.

Category 1: Feasibility studies

Funding is available for your eligible project costs of:

  • up to 60% if you are a micro, small or medium sized organisation
  • up to 50% if you are a large organisation

For more information on company sizes, please refer to the company accounts guidance.

If you are applying for an award funded under State aid Regulations, the definitions are set out in the European Commission Recommendation of 6 May 2003.

Innovate UK may revoke our decision to provide funding without notice if government commitment for this initiative is withdrawn.

Innovate UK reserve the right to adjust funding allocations for any of our competitions under exceptional circumstances, for example, in response to changes in policy, portfolio funding considerations, or broader government funding decisions.

Research participation

Whilst you may not apply to lead a project as an RTO, charity, not for profit organisation, public sector organisation or research organisation, you are able to work as subcontractors to businesses leading projects through this competition.

APC industry support

In securing funding from this programme, each participant receiving a grant will pay an industrial contribution to the APC operating budget. This is set at 3.5% and is payable on each grant received.

Portfolio approach

Innovate UK want to fund a variety of projects across different technologies, vehicle applications, markets, technological maturities, and organisational sizes, which are aligned to policy and regulatory deadlines enabling automotive transformation.

This includes the transition to fully zero emission vehicle manufacturing. As such, a selection of funded projects may be determined by the fit of the project to the competition portfolio. We call this a portfolio approach.

Interested in applying for this competition?

Book an appointment to speak to one of our advisors to discuss your eligibility to apply for this Grant Funding opportunity.