Greek philosopher Heraclitus first coined the phrase, ‘the only constant is change’, which typifies the state of the European car industry right now. And while the shift from internal combustion engines to EV power provides opportunities for UK electronics businesses, they need to understand how to engage with car manufacturers.
With change comes opportunity – and this is where UK companies (notably those working in software development and sensor technology) could really benefit. While European production of EVs has seen consistent growth over the last decade, new UK grants (providing discounts of up to £3,750 per vehicle priced under £37,000), give further confidence in the EV market. Currently EVs account for more than 22% of the market – a figure that is predicted to rise rapidly as the 2030 deadline approaches.
The automotive world is shifting from a deeply embedded style of supply chain into a nimbler model, which presents an opportunity for UK enterprises. However, tech companies need to understand how OEMs think and engage with suppliers.
Emerging opportunity
Given the UK’s track record in innovation, problem solving and investment in the ‘knowledge economy’, we are ideally placed to gain a foothold in the EV market. While the UK can no longer claim absolute global leadership in the quality of the physical parts it produces (with the notable exception of motorsports and niche vehicles), our reputation in the fields of programming, sensor technology and even gaming stand us in good stead to exploit this opportunity.
Better still, the UK government has highlighted advanced manufacturing and the digital / technology sectors as industries that will receive active support by way of R&D grants, tax breaks and skills investment over the next decade.
However, UK tech firms eyeing up the EV market need to consider carefully how to engage with automotive goliaths. Based on our experience of improving quality management for some of the world’s best-known vehicle manufacturers, there are two crucial areas that suppliers need to get right when approaching potential OEM customers: quality and supply.
Quality assurance and testing
Software glitches are becoming a major headache for OEMs, with JD Power [the American data analytics, software, and consumer intelligence company] recording in its 2024 report that six of the top 10 complaints about vehicle quality centred on infotainment problems. Worse still, the NHTSA [
National Highway Traffic Safety Administration] reported that in 2024, the number of software-related recalls surged by 80%, from 112 cases in 2023 to 202 the following year.
Moreover, software-related issues accounted for 44% of all recalled vehicles, amounting to 15 million units in the US alone — up from 2023’s 3.2 million vehicles. This explosion in numbers highlights how software issues are no longer isolated anomalies but represent a systemic challenge affecting the entire industry.
UK businesses that have the insight and knowledge to solve these problems are well placed to bump inferior competitors, who may have taken their ‘cost down’ strategies too seriously, at the expense of performance and quality.
Supply chain resilience and agility
In its 2025 white paper on automotive component sourcing, S&P Global highlighted ongoing issues facing suppliers, given the disruption caused by conflicts in Eastern Europe and the Middle East. Volatile tariffs barriers and the ongoing threat of cyberattacks have only added to the industry’s nervousness.
Despite these issues, businesses should remember to focus on those operations that they can control – which includes supply chain resilience and visibility. OEMs want to know that potential suppliers can deliver parts / systems to their various plants on a flexible basis as required.
Increasingly, they want to understand what plans you have in place to maintain operations in the event of supply chain challenges, up or down stream. How reliable is your supplier base? What level of buffer stocks will you hold and how exposed is your supply chain to external shocks? OEMs want to understand how you fit into their sequencing operations and the level of flexibility there is in delivery scheduling.
Sophisticated supply chain visibility is another key area that potential suppliers need to get right before they seriously commence the courtship dance with manufacturers. Most OEMs use online supplier platforms to share information and minimise supply chain disruption.
Interestingly, the UK government’s Industry Strategy, published in June, highlights the role of robust supply chains, announcing a £600m fund in the supply chain and industrial sites. It also mentions support for semiconductors and microelectronics production.
Enterprises involved in software programming, AI and sensor technology face great opportunities in the emerging EV market. With the support of government strategy, things could be looking up for those willing to plug into the changing supply chains of manufacturers.
However, businesses need to understand how to engage with OEMs and in some instances re-engineer their quality management practices to fit the zero-defect culture of global vehicle manufacturers. Better still, more enlightened industry practitioners are realising the benefits of a ‘value-add’ cost compared to the traditional ‘lowest cost’ mantra, which still dominates many assembly floors. Certainly, suppliers that can bring new thinking in terms of quality and customer satisfaction are better placed to form long-term relationships with OEMs.
Geoff Cousins is former managing director of Jaguar and is currently chairman of international quality management group G&P.
