Potential Implications for UK Manufacturing and the East Midlands
Author: Sue Tilley – Sue Tilley Associates
Date: 15th July 2026
Purpose
This paper has been prepared to stimulate discussion and invite informed challenge.
It reflects my current understanding of the European Commission’s proposed Industrial Accelerator Act and considers its potential implications for UK manufacturing, industrial competitiveness and the East Midlands economy.
It does not seek to advocate a political position, nor does it represent the views of any organisation with which I am associated.
Why this paper?
Following a number of recent conversations with manufacturing and innovation leaders, I became increasingly interested in the European Commission’s proposed Industrial Accelerator Act.
Whilst the legislation has attracted relatively little attention in the UK, I believe it raises wider questions about industrial competitiveness, investment and the future direction of manufacturing policy.
Rather than focus solely on the legislation itself, this paper asks whether it signals a broader strategic shift from which the UK should learn.
What is the Industrial Accelerator Act?
The proposed Industrial Accelerator Act forms part of the European Union’s wider industrial strategy.
Its objective is to strengthen Europe’s manufacturing capability by encouraging investment in strategically important sectors, accelerating industrial deployment and creating more resilient supply chains.
Priority sectors include:
- Automotive manufacturing
- Steel
- Batteries
- Hydrogen
- Renewable energy technologies
- Advanced manufacturing
- Energy systems
- Cement and aluminium
The Act proposes:
- “Made in EU” preferences in public procurement
- Low-carbon criteria for publicly funded projects
- Requirements that public support schemes favour European production
The goal is to give manufacturers greater confidence that investing in EU factories will translate into market access rather than competing purely on price against subsidised imports.
The EU commission hopes to legislate by the end of 2026 with a targeted implementation in Q3 2027.
Taken together, these proposals suggest a coordinated approach to strengthening Europe’s long-term industrial competitiveness.
Why should the UK pay attention?
The UK remains closely connected to European manufacturing through integrated supply chains, investment relationships and export markets.
Manufacturing investment decisions are influenced by many factors including policy certainty, infrastructure, energy availability, skills, innovation capability and market access.
If the European Union succeeds in creating a more attractive environment for industrial investment, there is a possibility that future investment decisions may increasingly favour locations within the EU.
This is unlikely to happen quickly.
However, manufacturing strategies are typically measured over decades rather than political cycles.
There will be a small number of “partner” countries which may be included within the initial IAA with their goods considered as “Assembled in the EU”. The countries under consideration include among others, Turkey, Morocco, Japan, South Korea and the UK. However at the moment the UK does not appear to be in a strong position for inclusion in the initial legislation. In particular France and Spain appear resistant to UK inclusion.
There is a perspective within the EU that the IAA should be established first and eligible countries reviewed later. However, delaying the matter does not help the UK as we are under a cloud of uncertainty and therefore essentially uninvestable at the moment as a manufacturing location across these sectors.
Why this matters to the East Midlands
The East Midlands is one of the UK’s leading manufacturing regions.
Its strengths include:
- Automotive and transport technologies
- Aerospace
- Rail engineering
- Advanced materials
- Logistics
- Life sciences
- Clean technologies
The region is also home to nationally significant assets including MIRA Technology Park, Charnwood Campus, Space Park Leicester, the East Midlands Freeport and internationally recognised universities. These provide an outstanding platform for growth.
The question is whether our wider policy environment is evolving at the same pace as that of our competitors.
The Bigger Strategic Question
Reading these proposals has prompted a broader question.
The European Union appears to be aligning industrial policy, investment, energy, innovation, skills and supply chains within a coherent strategic framework.
Where does this sit within the UK’s Industrial Strategy?
More specifically:
- Is UK response sufficiently coordinated?
- Is the UK providing investors with comparable long-term confidence?
- Are manufacturing, energy, infrastructure and innovation being considered as one integrated system?
- What role should regions such as the East Midlands play in delivering national industrial strategy?
These strike me as questions worthy of wider debate.
Questions for Discussion
I would particularly welcome views on the following:
- Have I interpreted the legislation correctly?
- Have I accurately reflected its potential implications for UK manufacturing?
- Am I asking the right strategic questions?
- What important issues have I overlooked?
- What should policymakers, businesses and universities now be discussing?
Conclusion
This paper is not intended to predict outcomes.
Its purpose is to encourage informed discussion about a policy development which, in my view, deserves greater attention within the UK.
Throughout my career in economic development, I have learnt that the most significant changes are often those that emerge gradually. By the time their effects become obvious, investment decisions have already been made and competitive positions have shifted.
If this paper prompts discussion and encourages others to challenge and strengthen its conclusions it will have achieved its purpose.
Sue Tilley
Get in touch with Sue Tilley Associates