Labour is preparing to channel tens of millions of pounds of public funds into British self-driving technology company Oxa as the party seeks to accelerate the rollout of autonomous vehicles on UK roads.
The £28 billion National Wealth Fund (NWF), backed by the Treasury, is reported to be close to a significant investment in Oxa, the Oxford-founded driverless vehicle start-up formerly known as Oxbotica. Established in 2014 by Oxford University academic Professor Paul Newman, Oxa became the first company to trial autonomous vehicles on UK roads in 2016.
Unlike traditional car manufacturers, Oxa focuses on software that enables existing vehicles to operate autonomously. Its technology is already deployed in driverless shuttle buses, as well as industrial and logistics vehicles, positioning the company as a key infrastructure player in the growing autonomous vehicle ecosystem. The firm has raised over £180 million from private investors to date.
The proposed public backing would come through the NWF, which launched in 2024 as the successor to the UK Infrastructure Bank. While operationally independent, the fund aims to support the government’s growth and industrial strategy, typically making direct investments of £25 million to £50 million to attract much larger sums of private capital.
If approved, the investment would represent one of the government’s largest direct bets on an artificial intelligence business, aligning with plans to begin trials of driverless taxis and buses later this year. Ride-hailing companies Uber and Lyft have already confirmed plans to test autonomous vehicles under the UK’s new regulatory framework, while Tesla continues to pilot its Full Self-Driving software in the country. Another UK start-up, Wayve, which has raised over £1 billion, is also preparing public trials in partnership with Uber.
Oxa’s funding discussions follow a £15 million injection from existing investors in December, including BP’s venture capital arm, alongside talks over a separate “frontier AI” round. Nvidia chief executive Jensen Huang publicly praised the company in September as an “incredible autonomous driving business,” signalling interest in future investment.
The firm has faced financial challenges. IP Group, an early backer, revealed last year that it had cut Oxa’s valuation by around two-thirds to £120 million, citing mounting losses and tougher conditions for deep-tech start-ups.
The National Wealth Fund has already committed over £200 million in equity investments and billions in debt financing for clean energy and battery manufacturing projects. In its first year, the fund invested £3.6 billion as part of the government’s broader push to stimulate long-term growth.
Neither Oxa nor the National Wealth Fund commented on the prospective deal, and the Treasury declined to provide a statement.
The investment would mark a significant step in the UK’s autonomous vehicle strategy, signalling strong government support for homegrown AI and self-driving technology.
