Rachel Reeves is preparing to pour tens of millions of pounds of public money into a British self-driving technology company as Labor seeks to speed up the rollout of autonomous vehicles on British roads.
The Treasury-backed £28bn National Wealth Fund (NWF) is understood to be close to agreeing a major investment in Oxa, the Oxford-founded self-driving vehicle start-up formerly known as Oxbotica. The company was founded in 2014 by Oxford University academic Professor Paul Newman and in 2016 became the first company to test autonomous vehicles on British roads.
Oxa has so far raised more than £180 million from private investors and is focused on developing software that can make existing vehicles autonomous, rather than making cars itself. Its technology is already used in driverless shuttle buses and industrial and logistics vehicles, positioning itself as an infrastructure player in the emerging autonomous ecosystem.
The proposed investment would be made through the National Wealth Fund, launched by Labor in 2024 to replace the UK Infrastructure Bank. Although operationally independent, the fund is designed to support the government’s growth and industrial strategy and typically makes direct investments of between £25m and £50m to mobilize significantly larger sums of private capital.
The fund’s backing would be one of the government’s biggest direct bets yet on an artificial intelligence business and would fall in line with plans to begin trials of driverless taxis and buses on British roads later this year. Ride-hailing groups Uber and Lyft have already confirmed their intention to test autonomous vehicles under the new UK regulatory framework, while Tesla continues to test its Full Self-Driving software in the UK. Another UK company, Wayve, which has raised more than £1bn, is also preparing public trials as part of a partnership with Uber.
Oxa’s latest funding talks follow a £15m capital injection from existing backers in December, including BP’s venture capital arm, as well as talks of a further ‘Frontier AI’ investment round. In September, Nvidia CEO Jensen Huang publicly praised the company as an “incredible autonomous driving company” and signaled interest in investing in the next round.
However, the company was under financial pressure. IP Group, an early investor, said last year it had cut Oxa’s valuation by around two-thirds to £120m, reflecting rising losses and tougher market conditions for deep-tech start-ups.
The NWF has already committed more than £200 million in equity investment and billions more in debt financing for clean energy and battery manufacturing projects. In Labor’s first year, it invested £3.6 billion as part of the government’s wider efforts to boost long-term growth.
Neither Oxa nor the National Wealth Fund commented on the proposed deal, and the Treasury declined to comment.
