The UK government has acquired a semiconductor factory in Newton Aycliffe, County Durham, in a move to strengthen the defence supply chain and support the Armed Forces.
This facility is the only secure site in the UK capable of manufacturing gallium arsenide semiconductors, a vital component in military platforms such as fighter jets.
Defence Secretary John Healey visited the site, which was previously owned by Coherent Inc. and will now be known as Octric Semiconductors UK. The acquisition is expected to secure up to 100 skilled jobs in the North East and safeguard a critical part of the UK’s defence infrastructure.
“Semiconductors are at the forefront of the technology we rely upon today, and will be crucial in securing our military’s capabilities for tomorrow.
This acquisition is a clear signal that our government will back British defence production. We’ll protect and grow our UK Defence supply chain, supporting North East jobs, safeguarding crucial tech for our Armed Forces and boosting our national security.”
Semiconductors are an essential component of modern electronics, from phones and computers to military applications. The government has stated that this acquisition will enhance the UK’s defence capabilities and increase its industrial capacity, with plans to invest further in the facility over the coming years.
The acquisition comes ahead of an Investment Summit aimed at strengthening the UK’s trading relations and supporting high-quality jobs at home.
With global semiconductor demand rising, this move positions the UK to meet future technological needs, including advancements in artificial intelligence, quantum technologies, and 6G.
Background
In 2023, Coherent, the former owner of the Newton Aycliffe semiconductor facility, announced plans to cut over 100 jobs due to a drop in business demand, leaving the future of the site in doubt. With the facility’s long history of ownership changes since it first opened in 1991, there were growing concerns about whether it could continue producing the crucial semiconductor components needed for industries like defence and aerospace.
The recent government acquisition is a key move to secure the future of this vital facility. By stepping in, the government is protecting jobs and ensuring the production of important semiconductors used in military applications, such as boosting fighter jet capabilities. This not only stabilises the plant after last year’s uncertainty but also strengthens the UK’s ability to maintain control over critical technology in the defence sector.