Newton Aycliffe, UK — The UK’s Armed Forces will see a significant boost to their defence capabilities following the government’s acquisition of a key semiconductor factory in the North East. The Defence Secretary, John Healey, visited the site today, marking the government’s strategic move to safeguard a crucial supply chain and secure the future of the facility, which specializes in gallium arsenide semiconductors.
These highly specialized semiconductors are critical components used in a range of military platforms, including systems that enhance fighter jet capabilities. The acquisition ensures that the UK’s only secure facility with the skills to manufacture these semiconductors will continue to support major military programmes and exports, while preserving up to 100 skilled jobs in the region.
The UK government’s decision comes at a time when semiconductors are increasingly important for both civilian and military applications. As an essential component of nearly all electronic devices, semiconductors are vital for everything from phones and computers to power stations and medical equipment. In military terms, they fill crucial technological gaps and bolster future operational needs.
The announcement precedes the upcoming Investment Summit, where the UK will signal its openness to global business and its ambition to foster a pro-innovation environment that creates high-quality jobs domestically. The acquisition is expected to further enhance the UK’s defence industrial capacity and stimulate exports, with government plans to invest in the factory in the coming years.
Defence Secretary Healey, during his visit to the newly named Octric Semiconductors UK, emphasized the strategic significance of semiconductors:
“Semiconductors are at the forefront of the technology we rely upon today, and will be crucial in securing our military’s capabilities for tomorrow.“
He added that the acquisition sends a clear message about the government’s commitment to supporting British defence production, securing jobs, and strengthening the nation’s security.
The Newton Aycliffe facility, previously owned by Coherent Inc, will not only continue producing gallium arsenide semiconductors but will also focus on advancing more powerful technologies. This includes semiconductors essential to future innovations such as artificial intelligence, quantum computing, and 6G, with the global semiconductor market projected to reach $1 trillion by 2030.
The government aims to ensure robust financial oversight and best-practice governance to secure the long-term success of the company, reinforcing the UK’s strategic position in critical technologies vital to defence and economic growth.