The IMI's pre-budget submission calls on HM Treasury for action

Automotive apprentices

“Government urgently needs to shift its myopic vision – and fiscal support – of automotive beyond manufacturing and R&D”

IMI pre-budget submission calls for urgent investment in UK’s automotive workforce outside the factory gates to keep vehicles on the road safe and support net zero ambitions

“For too long, government investment in automotive has stopped at the factory gates,” said Nick Connor, CEO of the Institute of the Motor Industry (IMI). “The people who keep vehicles on the road and consumers safe have been overlooked – yet they are vital to our economy and our net zero ambitions.

“Our message to HM Treasury in our pre-budget submission is clear: reform the Apprenticeship Levy so that it drives growth, invest in the whole automotive workforce, and fund the safety-critical training that protects the public. These are not wish lists – they are evidence-based reforms grounded in data and feedback from employers across the UK.”

Drawing directly on evidence from members, employers and SMEs, gathered through polling, focus groups, and the IMI’s own labour market data and forecasting, the voice of the automotive workforce has identified the precarious state of skills in the sector in its pre-budget submission to HM Treasury. The Apprenticeship Levy does not work for automotive; there is a lack of follow-through to aftermarket skills in government policy for new motoring technology; and current skills funding does not support the full automotive ecosystem.

Calling for decisive fiscal action to recognise the critical role of the 724,000 people in automotive working outside the factory gates, the IMI has identified three high-impact priorities: Apprenticeship and Levy reform; industrial and workforce investment; and investment in safety critical competence frameworks to protect workers and consumers. Without urgent investment, the economic contribution of the wider automotive workforce, worth over £37 billion to the UK economy’ is at risk, with consequences for productivity, public safety, and the nation’s net zero ambitions.

The IMI pre-budget recommendations

Reform the Apprenticeship Levy to unlock employer-led investment in skills
The IMI is calling for the Levy to be made genuinely flexible so automotive employers can invest where it is most needed, in apprenticeships, modular upskilling, and safety-critical training. Levy flexibility should empower employers, not constrain them with rigid rules, ensuring the sector can respond to rapid technological change. With ring-fenced support for automotive apprenticeships and reduced administrative barriers for SMEs, this reform would unlock private investment, boost productivity, and reduce long-term fiscal pressure on government.

Explicit skills funding for the workforce beyond the factory gates  

The IMI is also calling for the creation of an Automotive Workforce Transition Fund, ensuring Skills England and devolved budgets explicitly support the entire workforce beyond the factory gates. This includes not only technical training but also leadership, digital, diagnostic, logistics, and customer-facing roles,  all vital to sustaining economic growth and a successful green transition.

Matched government funding for safety and competence standards 

The IMI is urging HM Treasury to co-invest with employers in training aligned to the IMI TechSafe standard, the national benchmark for competence in electric, hydrogen, and ADAS technologies. Embedding TechSafe within skills funding, MOT reform, and procurement frameworks would ensure consistent national safety standards, protect consumers, and strengthen public confidence in new vehicle technologies.

The IMI is also urging government to reassess recent Employer Car Ownership Scheme (ECOS) tax changes. With a current skills gap of 14,000, it is vital that workforce mobility is not undermined and automotive careers remain viable for technicians, assessors and field-based professionals who rely on vehicles for their work.

As the UK’s authoritative voice for automotive skills and professionalism, the IMI is calling for evidence-based fiscal reform that empowers employers, protects consumers, and secures a future-ready workforce.

The IMI continues to champion the full breadth of the automotive workforce, from engineers and technicians to logistics, sales, customer service, and business leaders, who together sustain a sector contributing over £37 billion to the UK economy. Working in partnership with government and Skills England, the IMI is committed to ensuring every occupation in automotive is equipped for a safe, sustainable, and competitive future.

Read the full IMI pre-budget submission.