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APC 18: Developing the UK’s low carbon automotive capability


UK-registered businesses can apply for a share of up to £25million for UK-developed late-stage R&D, to support growth in advanced low carbon propulsion capability in the automotive sector and its’ associated supply chain.

The Advanced Propulsion Centre (APC) invests up to £30million, up to three times a year, in collaborative research and development (R&D) projects. These are pre-production match-funded projects. In this round, APC is investing £25million.

Your project must concentrate on the automotive market as its primary application.

APC 18 is looking for:

  • Projects that support the UK’s long-term capabilities through securing long-term R&D investment
  • Projects that can be achieved through its associated supply chain in the design, build and manufacture of zero tailpipe emission vehicles

Your project will preferably deliver both of these, to ensure the UK meets the future demand of vehicle-makers.

Your project’s total eligible costs must be between £5million and £40million and be a minimum of 50% match funded.

Open Date:


Close Date:


The aim of this competition is to seek proposals for collaborative R&D projects. These must demonstrate the development of on-vehicle technologies, (including material, product and manufacturing processes) for on or off-road vehicles.

Your project must address one of the following:

  1. Accelerate the development of technologies capable of low and zero tailpipe emissions, considering their associated ‘cradle to grave’ supply chains, up to and including end of life.
  2. Demonstrate a significant reduction in carbon dioxide emissions leading to air quality improvements.

Your proposal must clearly align with the UK’s Industrial Strategy and must demonstrate how high value R&D will take place in the UK as a result of this funding.

APC is particularly looking for projects that support the UK’s long-term supply chain, associated capabilities and growth aspirations. This includes improving productivity and competitiveness in the design, build and manufacture of vehicles that are capable of low and zero tailpipe emissions.

Technologies in scope are:

  • Motors
  • Batteries
  • Power electronics
  • Hybridisation
  • Alternative propulsion systems

Your project must support the growth of these technologies, creating more jobs and capability throughout the UK supply chain.

Your application should demonstrate a positive impact on the UK economy. This can include but is not limited to projects that will make a major investment in:

  • Creating new supply chains supporting the transition to electrification and zero emission vehicles
  • Adding resilience to existing supply chains under a variety of circumstances where applicable such as low, medium, high production, niche, off highway, commercial or volume passenger vehicles
  • The delivery of a UK centric high value manufacturing and sourcing footprint
  • Lowering the overall cost of goods sold to customers
  • Connecting less productive or mature elements of existing UK supply chain, leading to business efficiencies and helping to reduce uncertainty and risk
  • Recovering or reclaiming raw materials that can be used as new automotive product feedstock, resulting in improving the resilience and competitiveness of associated automotive supply chains.
  • Attracting new companies not traditionally delivering products, services or skills in automotive into the sector
  • Risk screening and due diligence to identify risks in the proposed supply chain developments
  • Improving the manufacturing readiness level (MRL) of your technology

Your project can either focus directly on improving the MRL, or it can create step changes in development processes, manufacturing processes or supply chain enhancements that will lead to an improved MRL.

Your application must show:

  • A clear route to market exploitation and have a consortium able to deliver this
  • The economic benefits of the project, such as new and safe-guarded jobs, new business activity, or an expansion of products and services
  • That the primary application of the project is for the automotive industry
  • How the project will support upskilling and knowledge sharing in the UK
  • That the project delivers impacts that would not be achieved in business as usual
  • What would happen to the project if funding is not successful and why the specific amount of funding is needed
  • How UK plc will benefit from any intellectual property generated by the project
  • That you will demonstrate the majority of the technologies in a system or major sub system in a vehicle representative environment

APC wants to fund a portfolio of projects, across the technologies listed in the specific themes section, and a variety of markets, technological maturities and research categories.

Innovate UK strongly encourage you to:

  • Demonstrate senior management commitment to the project and consortium
  • Ensure the consortium’s collaboration agreement is well advanced at the point of submission
  • Include the most important supply chain members in your consortium
  • Show how you will get disruptive technologies to market faster
  • Contact and work with organisations that are an important part of the supply chain but are not typically involved in R&D, such as tooling, manufacturing processes and materials
  • Focus on alternative propulsion systems which move the industry towards zero emissions, including hybridisation
  • Consider the possibility of technology transfer to and from other sectors into automotive
  • Focus on technologies that are identified in the Automotive Council’s roadmaps
  • Focus on lasting growth with the electric and electrified vehicle supply chain
  • Consider how to make results from this work public, where it helps share best practice while not damaging commercial interests. Read more about dissemination of your results in the Innovate UK funding rules.

APC will also consider projects that focus on the significant reduction of carbon dioxide or improvement of air quality from advanced internal combustion engines, especially those using clean fuels. Projects focusing solely on clean fuels are out of scope.

The UK is committed to deepening its supply chain presence for automotive, as described in the Industrial Strategy Automotive Sector Deal. For internal markets, this means supporting the industry’s ambition to increase the level of UK content by value in domestically built vehicles, to 50% by 2022.

Specific themes

Your project must focus on one or more of the following strategic technology themes. You must determine which technology or technologies best represent your project:

  • Alternative propulsion systems
  • Electric machines and power electronics
  • Energy storage and energy management
  • Lightweight vehicle and powertrain structures
  • Thermal propulsion systems that deliver substantial improvements
  • Significant reduction in vehicle development timescales
  • Digitisation for development of low carbon vehicle innovation

Your project must:

  • Have total eligible costs between £5million and £40million
  • Be a minimum of 50% match funded
  • Start by 1 November 2021
  • Last between 18 and 42 months

To lead a project, your organisation must:

  • Be UK-registered business of any size
  • Have an active registered business base in the UK
  • Be a grant recipient
  • Involve at least one SME if the lead is not one
  • Include in your consortium a vehicle manufacturer or tier 1 supplier who supplies parts directly to an original equipment manufacturer (OEM)
  • Collaborate with others
  • Carry out its project work in the UK
  • Intend to exploit the results from or in the UK

Academic institutions and research organisations cannot lead projects.

For more information on company sizes, please refer to the company accounts guidance. This is a change from the EU definition unless you are applying under State aid.

To collaborate with the lead, your organisation must:

  • Be a UK-registered business of any size, academic institution or research and technology organisation (RTO)
  • Carry out its project work in the UK
  • Intend to exploit the results from or in the UK

If businesses and research organisations are non-UK based, they are only eligible to apply for funding if they:

  • Set up an active UK registered business base before they start their project, where the funded work will be carried out
  • Provide evidence that they intend to expand their R&D activity in the UK after the project

The lead and at least one other organisation must claim funding by entering their costs during the application.

Each partner organisation must be invited into the Innovation Funding Service by the lead to collaborate on a project. Once accepted, partners will be asked to login or to create an account and enter their own project costs into the Innovation Funding Service.

Your project can include partners that do not receive any of this competition’s funding, for example non-UK businesses. Their costs will count towards the total eligible project costs.


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 why you could not use suppliers from the UK.

You must also provide a detailed rationale, evidence of the potential UK contractors you approached and the reasons why they were unable to work with you.

Innovate UK expect all subcontractor costs to be justified and appropriate to the total eligible project costs. Innovate UK will not accept a cheaper cost as a sufficient reason to use an overseas subcontractor.

Number of applications

There are no limits on the number of applications an organisation can be involved in.

Previous applications

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

Innovate UK will not award you funding if you have:

Subsidy control (and State aid where applicable)

This competition provides funding in line with the UK’s obligations and commitments to Subsidy Control. Further information about the UK Subsidy Control requirements can be found within the EU-UK Trade and Cooperation agreement and the subsequent guidance from the department of Business, Energy and Industrial Strategy (BEIS).

Innovate UK is unable to award organisations that are considered to be in financial difficulty. Innovate UK will conduct financial viability and eligibility tests to confirm this is not the case following the application stage.

European Commission State aid

You must apply under European Commission State aid rules if you are an applicant who is conducting activities that will affect trade of goods and electricity between Northern Ireland and the EU as envisaged by Article 10 of the Protocol on Ireland/Northern Ireland in the EU Withdrawal Agreement.

In certain limited circumstances, the European Commission State aid rules may also apply if you are an organisation located in England, Wales, or Scotland and conduct activities that affect the trade of goods and electricity between Northern Ireland and the EU. For further information, please see section 7 of the BEIS technical guidance.

For further information see the general guidance on state aid and BEIS guidance on the Northern Ireland Protocol.

For applicants subject to the European Commission State aid rules, applicants will be required to prove that they were not an “Undertaking in Difficulty” on the date of 31 December 2019 but became a UID between 1 January 2020 and 30 June 2021. Innovate UK will ask for evidence of this.

Further information

If you are unsure about your obligations under the UK Subsidy Control regime or the State aid rules, please take independent legal advice.

You must make sure at all times that the funding awarded to you is compliant with all current Subsidy Control legislation applicable in the United Kingdom.

This aims to regulate any advantage granted by a public sector body which threatens to or actually distorts competition in the United Kingdom or any other country or countries.

If there are any changes to the above requirements that mean Innovate UK need to change the terms of this competition, they will tell you as soon as possible.

Innovate UK are not funding projects that:

  • Are dependent on export performance – for example giving a subsidy to a baker on the condition that they export a certain quantity of bread to another country
  • Are dependent on domestic inputs usage– for example if it was insisted that a baker use 50% UK flour in their product
  • Focus only on the development of clean fuels

APC has allocated up to £25million to fund innovation projects in this competition.

If your organisation’s work on the project is mostly commercial or economic, your funding request must not exceed the limits below. These limits apply even if your organisation normally acts non-economically.

The total grant request in your application cannot exceed 50% of the total eligible project costs, of which at least 70% must be incurred by commercial organisations.

For industrial research projects, you could get funding for your eligible project costs of:

  • Up to 70% if you are a micro or small organisation
  • Up to 60% if you are a medium-sized organisation
  • Up to 50% if you are a large organisation

For experimental development projects which are nearer to market, you could get funding for your eligible project costs of:

  • Up to 45% if you are a micro or small organisation
  • Up to 35% if you are a medium-sized organisation
  • Up to 25% if you are a large organisation

The research organisations undertaking non-economic activity as part of the project can share up to 30% of the total eligible project costs. If your consortium contains more than one research organisation undertaking non-economic activity, this maximum is shared between them.

A 3.5% levy is payable to the APC by all partners on grant received.

Cresco Innovation works with companies to develop and implement innovation strategies. We help client companies identify opportunities to develop new products and services, and then create a package of support to ensure that the idea is turned into a commercial reality.

Our services include securing grants (as a team we have raised around £40million over three years), business planning, IP advice, access to finance and funders, project management and IP commercialisation support.

We regularly act as the interface with the funding bodies and help clients ensure that their projects are properly managed to ensure the best outcome for all.

Call to find out more

If you’d like to know more about this competition, please give us a call on 01509 261182 and one of our team will be delighted to help you access this funding opportunity for your business.