The money will be spent improving infrastructure, in an effort to maintain the UK's leading position in development of the technologies.
The UK government is set to invest £390 million ($484 million) boosting the development of electric and autonomous vehicles, and the infrastructure that supports them.
Chancellor of the Exchequer Philip Hammond made the announcement during his Autumn Statement earlier this week.
He said that “reliable transport networks are essential to growth and productivity.” He added that the investment would “build on our competitive advantage in low-emission vehicles and the development of connected autonomous vehicles.”
In 2015, the Conservative government approved a plan for autonomous cars to be tested on UK roads. A number of automakers including Volvo and Jaguar Land Rover are already taking advantage of the situation.
The Statement also included investment in high-speed, 5G wifi which is crucial if autonomous cars are to talk with each other and infrastructure properly.
The Society of Motor Manufacturers and Traders, which represents the UK auto industry, responded: “We welcome the investment to enhance the charging network for electric vehicles, as well as further support to boost uptake of low emission buses and taxis.”
UK Sales of alternative fuel vehicles, the vast majority of which are plug-in hybrids and pure electric cars, grew more than 23 percent in the year to October over the same period in 2015, itself a record-setting year for AFV sales. In total, they account for about three percent of new car sales in the UK. The Mitsubishi Outlander PHEV holds the sales lead.
The SMMT added: “Furthermore, the commitment to connected and autonomous vehicle testing infrastructure is an area in which the UK is already one of Europe’s leading centres. This commitment will help cement that position and promote this next generation technology, which has the potential to transform lives - preventing more than 25,000 accidents and creating more than 320,000 new jobs.”
It is predicted the global autonomous vehicle industry will be worth $1.1 trillion by 2025.