The UK automotive sector is on the cusp of a £4.6 billion surge in domestic manufacturing as car manufacturers accelerate their shift towards electric vehicles. New analysis by the Society of Motor Manufacturers and Traders (SMMT) indicates that demand for British-built components is set to rise by 80% by 2030, presenting a significant opportunity for investors to revitalise the local automotive supply chain.
The industry is set to benefit from substantial opportunities in the development of next-generation electric and other vehicle technologies. This positions the UK to maintain its status as a leading automotive manufacturing base, with a vision to achieve an annual output of 1.3 million vehicles by 2035.
In December 2025, Sunderland marked a milestone with the commencement of volume production of next-generation battery electric vehicles. This year, the launch of seven new electric vehicle models across the UK is expected to double battery electric vehicle volumes by 2028. Consequently, the demand for electric motors, power electronics, and drive systems is projected to increase by over 350% by the decade’s end. Automotive electronics demand will also grow, driven by the integration of advanced displays, wiring systems, and computing power in electrified vehicles.
Additionally, battery-related localisation is forecasted to rise significantly, with demand for battery packs, modules, and cells tripling by 2030. Investment in supporting systems such as casings, battery management software, and thermal management is expected to follow suit.
Current automotive manufacturing remains a cornerstone of the UK’s value proposition, with production of interiors, body structures, and exterior components holding strong in the local supply chain output. Opportunities in seat assemblies, plastics, pressings, castings, and braking systems remain lucrative. Meanwhile, demand for high-performance internal combustion engine components continues to be significant.
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