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Britain's chip strategy: Cambridge or nowhere

The government has decided not to compete with Dresden and Arizona on fabrication plants. Its bet is on design, and on one city

A finished silicon wafer, each square a single chip.
A finished silicon wafer, each square a single chip. Photograph: Rob Bulmahn/Wikimedia Commons
Sam Okafor, technology editor
Sat, 10 Oct 2026 22:51 BST
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Britain will not try to build the giant semiconductor factories rising in Germany and the United States, the government has confirmed. Its strategy instead is to concentrate on chip design and on the cluster of companies around Cambridge that already dominates it.

The decision ends two years of lobbying by groups that wanted the kind of subsidies that bought Dresden three new plants. Ministers concluded that Britain could not match them and should not try.

“We are not going to win a subsidy race against people with deeper pockets,” said one official. “We can win on the thing we are already good at.”

Critics said the approach left Britain dependent on foreign fabrication for everything it designs.