£1.1bn CV investment underlines zero-emission opportunity
More than £1.1 billion has been committed to Britain’s van, truck and bus manufacturing sector and its supply chains since 2021, highlighting the UK’s growing role in the global shift towards zero-emission road transport.
New analysis from the Society of Motor Manufacturers and Traders (SMMT) shows that investment is building on the UK’s diverse commercial vehicle (CV) manufacturing base, with more than 30 different models and conversions already in production or planned.
The vehicles span low-emission models through to advanced electric and hydrogen-powered vans, trucks and buses, alongside thousands of components and technologies supporting the transition to cleaner transport.
The scale of the sector also gives it strategic importance to regional economic growth. More than a third of SMMT members are active in commercial vehicle production or its supply chain, while businesses from more than 20 countries have manufacturing, research and development, supply or service operations in the UK.
International companies from Europe and the Middle East, the US, Japan, China and India are among those investing in the UK commercial vehicle ecosystem.
Further opportunities for collaboration are being supported through the Government’s £4.5 billion DRIVE35 programme. So far, 42 zero-emission vehicle (ZEV) and supply chain projects capable of benefiting the commercial vehicle sector have received backing.
UK commercial vehicles have global reach
Britain’s international trading relationships also provide an important platform for the sector, with UK trade deals covering around 100 countries and markets.
These include the EU-UK Trade and Cooperation Agreement, membership of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and new trade deals with the US, India and Gulf Cooperation Council (GCC).
More than half of British-built commercial vehicles are exported, with around nine in 10 exports destined for European markets.
At the same time, the UK commercial vehicle industry is becoming increasingly important to road transport decarbonisation.
More than half of the 30-plus commercial vehicles currently in or planned for UK production – 18 models – are zero-emission vehicles. They are supported by a growing domestic supply chain manufacturing batteries, hydrogen fuel cells, semiconductors, electric drive units, magnets and energy storage systems.
The UK’s electricity generation mix could further strengthen the environmental credentials of British-built electric vehicles. More than 40% of UK electricity generation came from renewable sources in 2025, potentially giving EVs manufactured in Britain a lower embedded carbon footprint than those produced in some other major manufacturing nations.
Strong domestic market for vans, trucks and buses
The UK also offers manufacturers a significant domestic market in which to develop and deploy new zero-emission commercial vehicles.
Britain was Europe’s second-largest market for both vans and HGVs in 2025, with 315,422 vans and 40,504 heavy goods vehicles registered.
The UK is also Europe’s largest market for zero-emission buses. A total of 2,508 were registered in 2025, accounting for 27.1% of the market.
Increasing choice is helping fleets transition to cleaner vehicles, with more than 80 different zero-emission van, truck and bus models now available in the UK.
Government incentives and infrastructure investment worth more than £1.7 billion to date are also helping support fleet uptake and the wider development of the zero-emission commercial vehicle market.
For fleet operators, the expanding manufacturing base means greater choice of electric and hydrogen vehicles, while increased investment in components and charging and refuelling technologies should help strengthen the ecosystem needed to operate them at scale.
SMMT says the combination of industrial expertise, international investment, innovation and growing demand leaves the UK well positioned to play a major role in the next phase of commercial vehicle decarbonisation.
Mike Hawes, SMMT Chief Executive, said, “The shift to zero emission road transport is creating new opportunities across the global commercial vehicle industry, from vehicle manufacturing and engineering to supply chains and advanced technologies. The UK’s strength lies in its combination of industrial capability, innovation, skilled people and international partnerships. With investment already flowing and demand rising for next-generation vans, trucks and buses, the sector is well placed to help shape the future of sustainable mobility.”
British and international businesses based in the UK are also showcasing their capabilities at IAA Transportation in Hannover, Europe’s largest trade show for the van, HGV and bus sectors, which takes place from 14-16 September.
The event provides an opportunity for UK manufacturers, technology companies and suppliers to demonstrate Britain’s commercial vehicle innovation ecosystem and establish further international partnerships.
