28 November 2022
If you are covering news of the Business, Energy and Industrial Strategy Committee’s report into the semiconductor industry in the UK, please find below a comment from Ben Barringer, equity research analyst at Quilter Cheviot:
“While MPs are rightly concerned about the lack of a coherent strategy around microchip supply here in the UK, it is important to remember that the UK is a seriously small player in the context of the whole industry. A lot has obviously been made about the proposed sale of Newport Wafer Fab, but even that is a tiny operator in what is a global industry dominated by the market leaders.
“The UK, therefore, is way behind the curve, and given the expenditure that would be required, the current environment suggests that investment is not exactly going to be forthcoming. As a result, UK legislators would be better off securing their supply chains to avoid a repeat of the shortages we have seen over the past couple of years. With Europe wanting a piece of the semiconductor market, this may mean a closer partnership in this regard, particularly given the lack of any movement in trade with the US.
“With global security threats also becoming a real concern, action does need to be taken quickly. Unfortunately, the UK has lagged so far behind and not taken advantage of success stories such as Arm, that it needs to look at alternatives to manufacturing in order to secure that supply.”
