Drive35 Innovation Fund: Demonstrate 2 (UK Grant, 2026) — Historical Reference

Drive35 Innovation Fund: Demonstrate 2 (UK Grant, 2026) — Historical Reference

This page is a historical reference, not an open application call. The official UKRI opportunity page and its linked Innovation Funding Service record mark DRIVE35 Innovation Fund: Demonstrate 2 as Closed. The competition opened on 5 January 2026 and closed at 11:00am UK time on 11 March 2026. The official pages checked for this update do not announce a replacement round or a later deadline, so applicants should not treat this entry as permission to submit now or as evidence that a new cycle exists.

The deadline field keeps 2026-03-11 because it is the genuine closing date for the completed competition. historicalReference = true tells the site that this is an archive entry with a real past date, rather than a live listing that has simply been allowed to expire. If Innovate UK or the Department for Business and Trade announces another DRIVE35 competition, that future call should be checked separately and this page should not be used as its application record.

At a glance

What the competition was designed to fund

DRIVE35 is a Department for Business and Trade-led programme intended to transform the UK automotive industry by supporting research and development, commercial scale-up and capital investment connected with zero-emission vehicles, batteries and the wider supply chain. Innovate UK ran this competition with DBT, the Advanced Propulsion Centre UK, automotive industry participants and academia.

The Demonstrate 2 strand was for a project that would develop a product or process demonstrator and show increased capability and a credible commercial exploitation opportunity as a result of the work. It was not a general early-stage idea fund. The proposal needed to explain what would be built, integrated, tested or validated, what capability would be demonstrated, and how the result could support market use, industrial deployment or follow-on investment.

The competition required proposals to support growth, transition and security in the UK automotive supply chain while improving productivity, efficiency or competitiveness. A proposal also had to contribute to UK strategic priorities, deliver an on-vehicle technology or manufacturing capability that supports the transition to zero-emission vehicles, target post-project commercialisation, create or safeguard high-value jobs, and support long-term research and development investment.

The scope had three themes. Theme 1 covered zero-emission vehicle technologies, including electrical energy storage, batteries and their management systems, electric machines and drivelines, power electronics including vehicle-to-everything systems, qualifying non-fossil-fuel internal combustion applications, lightweight structures, fuel-cell systems, and hydrogen storage or management. It could also include relevant upstream supply chains, circularity and design for disassembly, and digital tools for validation, verification and design.

Theme 2 covered manufacturing competitiveness. Eligible work could address digital transformation in manufacturing, process decarbonisation, lean manufacturing, circularity, advanced automation, and supply-chain development. The outcome needed to increase the likelihood and competitiveness of manufacturing zero-emission vehicles or their associated systems in the UK. A general back-office software project was outside scope.

Theme 3 covered future vehicle innovation through software-defined vehicles and electrical/electronic architectures. Examples included embedded software and connectivity, control-system integration, scalable electrical/electronic architectures, high-performance computing, sensors and actuators, vehicle and system simulation, digital twins, in-the-loop validation, and safe and secure use of artificial intelligence in functional software.

The guidance also listed work that would not be funded. This included projects requesting more than 50% grant funding, projects focused on business processes not directly involved in vehicle design, testing, validation, recycling, reuse or manufacture, automated driving systems, projects focused only on clean fuels, work that did not align with the UK net-zero research innovations framework, and e-scooter or e-bike development.

Funding amount and cost rules

The headline budget was up to £33 million across innovation projects, subject to receiving enough high-quality applications and to Innovate UK’s right to adjust allocations in exceptional circumstances. That total was not a guaranteed award for each applicant. Each project had to request between £500,000 and £1.5 million in eligible grant funding and had to be at least 50% match funded. For example, a £500,000 grant request required at least £1 million in total eligible project costs.

Applicants were expected to request only the minimum grant needed to make a viable pre-production project possible. The grant could not exceed £1.5 million or 50% of total eligible project costs, regardless of how claims were divided between partners. At least 70% of total project costs had to be incurred by commercial organisations.

The applicable funding intensity depended on the research category and organisation size. For industrial research, micro and small organisations could receive up to 70% of eligible project costs, medium-sized organisations up to 60%, and large organisations up to 50%. For experimental development nearer to market, the corresponding limits were 45%, 35% and 25%. The organisation receiving the grant had to fund the balance of its eligible costs.

Research organisations undertaking non-economic activity could share up to 30% of total eligible project costs. Within that portion, research and technology organisations, charities, not-for-profits, public-sector organisations and research organisations could receive up to 100% of eligible costs, while eligible academic institutions could receive 80% of full economic costs through the Je-S process. A 3.5% industrial contribution to the Advanced Propulsion Centre UK was payable by all partners on grant received.

Eligibility and project requirements

The competition accepted single applicants and collaborations, but a lead applicant working alone or leading a consortium had to be a UK registered business of any size. Academic institutions could not lead or apply alone. A collaboration could include UK registered businesses, academic institutions, charities, not-for-profit organisations, public-sector organisations and research and technology organisations. The lead had to invite each partner through the Innovation Funding Service, and partners had to accept the invitation and enter their own project costs.

For the application to count as an eligible collaboration, the lead and at least one other organisation had to apply for funding by entering costs. The proposal had to explain why the collaboration was needed and describe its structure. Non-funded partners could participate, including organisations outside the UK, with their costs covered from their own resources. Subcontractors were allowed, but overseas subcontracting required a detailed case showing why suitable UK subcontractors could not be used; lower price alone was not sufficient.

The project had to deliver a demonstrator that enabled a new commercial opportunity or helped secure follow-on investment. It had to align with at least one of the three themes, reach TRL 5-6 or MRL 4-5 by completion using the published Automotive Technology and Manufacturing Readiness Levels, carry out all project work in the UK, and intend to exploit the results from or in the UK. The required duration was 9 to 12 months, with a planned start from 1 September 2026 and completion by 31 August 2027. Projects had to begin on the first day of the month and could not start before Innovate UK approved the Grant Offer Letter.

Applicants also needed to be able to start on time, match fund their work, obtain relevant permits and licences, comply with subsidy-control requirements, address animal-welfare requirements where relevant, and meet sanctions and prior-grant obligations. The guidance warned that outstanding sums owed to Innovate UK or UKRI, overdue industrial contribution payments to the APC, an overdue independent accountant’s report, or failures to comply with grant terms could affect an award.

How applications were prepared and submitted

There is no current submission route for this closed round. The following records the application process that applied to the 2026 competition so that the archive remains useful without implying that late applications are possible.

1. Read the competition guidance and choose the correct strand. DRIVE35 had a separate Collaborate strand and this Demonstrate strand. Applicants were responsible for choosing the right competition; an out-of-scope application could not be transferred for assessment.
2. Form the project team. A lead business had to decide whether it could deliver alone or needed partners. For a collaboration, it invited partners through the Innovation Funding Service, documented the reason for the collaboration and allocated responsibilities, costs and project-impact work.
3. Define the demonstrator and theme fit. The proposal needed a specific product or process outcome, a starting and ending maturity level, evidence for the current development status, technical deliverables, commercial use, and a clear match to one or more of the three themes.
4. Complete the Innovation Funding Service project details. This section covered the application team, project title, start date, duration, research category, project summary, public description and scope. The project summary, public description and scope answers could each be up to 400 words.
5. Answer the scored and unscored questions. The application covered applicant location, animal testing, permits and licences, international collaboration, export control, trusted research and innovation, communications contact, theme percentages and funded-project context. Scored questions covered strategic rationale and market opportunity, innovation, technical approach and project management, team, supply chain, risk management, exploitation and dissemination, costs, and added value.
6. Prepare the required appendices. The guidance required a project plan or Gantt chart and risk register as appendices. Applicants could also provide supporting appendices for market opportunity and innovation. These files had to be legible PDFs of no more than two A4 pages and 10MB where the question specified that limit. Applicants could not include website addresses or URLs in their written answers.
7. Complete the finances and monitoring form. Each organisation entered its own project costs, organisation details and funding details. Academic institutions used the Je-S form where applicable. The Economic Monitoring Form had to be completed and uploaded to Question 19, with “Worksheet Uploaded” entered as the response.
8. Complete every section and resubmit before the deadline. Before submission, the lead was responsible for checking the accuracy of the information, eligibility and scope, completion of all sections, partner completion and acceptance of the terms and conditions. A submitted application could be reopened until the competition deadline, but it had to be resubmitted by 11:00am on 11 March 2026.

What a strong proposal needed to demonstrate

The best fit would have been a team with technical evidence and a practical route beyond the grant. “Demonstration” needed to be expressed as measurable proof: a defined performance target, test conditions, validation method, baseline, deliverable and acceptance criterion. A proposal that only described future research questions would have struggled to show that it belonged in a late-stage demonstrator strand.

The technical plan needed to connect work packages, milestones, costs, dependencies and review points. It needed to address engineering challenges such as integration, durability, manufacturability, safety, cybersecurity where relevant, supply availability, test access and repeat testing. The team question asked why the people and organisations would be ready to start from 1 September 2026, so partner commitments and procurement readiness mattered.

The commercial case needed more than a broad claim that zero-emission vehicles are growing. Applicants had to identify the customer problem, market size and trends, competition, serviceable and obtainable market, route to market, potential partnerships, supply-chain opportunity and intellectual-property advantage. The proposal also had to explain how public funding would increase UK R&D spend and produce benefits such as commercial growth, high-value jobs, supply-chain capability, energy or carbon savings, or faster adoption.

Risk management was a central part of the application. The team had to address technical, commercial, managerial and environmental risks and provide a risk register with mitigations. A credible budget should have covered the actual integration and validation work, including specialist equipment, test facilities, engineering time, subcontractors, re-tests and the work needed to turn a demonstrator result into a commercial decision.

Funded teams would also have had to plan exploitation and dissemination. The application asked how project outputs would become products, services, processes or applications; how results would be sustained after the project; how findings would be shared through web content, customer presentations, exhibitions, conferences, seminars or publications; and who would be responsible for each activity. The competition also required readiness for a possible showcase at the 2027 CENEX Expo and a close-out report and case study at project completion.

Timeline and archive note

The official competition timeline recorded an opening date of 5 January 2026, a live question-and-answer session on 16 January 2026, and the closing date of 11 March 2026 at 11:00am. The later assessment timetable listed invitations to interview on 13 April 2026, technical feedback on 22 April 2026, an applicant deadline for interview presentations on 27 April 2026, interview panels running from 5 May 2026 to 15 May 2026, and applicant notification on 20 July 2026 at 3:50pm. Projects were scheduled to start from 1 September 2026.

Those dates describe the completed competition. The official UKRI page remains available and returns a successful response, but its status is closed. The linked Innovation Funding Service page likewise says, “This competition is now closed.” No next DRIVE35 Demonstrate deadline is published on those official records. Check Innovate UK, UKRI and the Innovation Funding Service for a separately announced future call before preparing a new application.

Official source

The verified programme record is the UKRI opportunity page, which links to the closed Innovation Funding Service competition. These are the sources to use if a new DRIVE35 strand is announced. This entry preserves the 2026 Demonstrate 2 facts for reference and does not present the closed competition as available for submission.