When satellite communications innovator Filtronic signed a multimillion-dollar landmark deal with Elon Musk's rocket company SpaceX last year, it turned heads and proved the North East’s pedigree in advanced electronics.
Only months later, the Ministry of Defence made the unusual decision to buy a nearby semiconductor factory in County Durham. The Octric factory, formerly Coherent, is one of the country’s largest semiconductor manufacturing sites and produces gallium arsenide chips used by the military including to boost fighter jet capabilities.
The Government has signalled its intention to invest in the Newton Aycliffe plant, which employs 100 people and that’s not only good news for shoring up the country’s sovereign supply chain but also for the North East’s advanced material electronics (AME) cluster, which industry experts say shows great promise.
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Octric and Filtronic are just two companies highlighted among regional strengths in a new report which suggests the AME industry could support more than 7,500 jobs and contribute nearly £900m to the North East economy in the next five years.
AME is seen as the bedrock industry that underpins a plethora of digital technologies and includes a diverse range of companies from chip makers to microwave communications specialists. The paper published by Business Durham and the Compound Semiconductor (CSA) Catapult identifies the region is already responsible for 19% of the 海角视频’s total AME research output and currently supports 2,800 jobs.
According to the report’s authors, there is room for much more with average projected employment growth in the industry of 43% over the next five years, and 44% of firms fitting into the AME bracket anticipating growth of more than 50%.
Filtronic is set to double its manufacturing capacity at its NETPark, County Durham, home - a move which is intended to keep it at the forefront of the highly specialised, high-frequency RF and mm-Wave communications technology market. Tudor Williams, the director of technology at Filtronic, explains: “When I started three and half years ago we were mainly a telecoms and defence company, working on backhaul for 5G. So we were doing quite advanced millimetre wave for telecoms. But that’s flipped on its head now and we’ve become mainly a space company and that’s the biggest part of the company now.”
The opportunity has come with what is called “New Space” - the rise of the private space industry and its mega-constellations of low Earth orbit (LEO) satellites that provide networks used to provide broadband internet and remote sensing capabilities. Firms like SpaceX, Blue Origin and Amazon’s Project Kuiper have disrupted the market which had previously been about time consuming and costly production of geostationary satellites.
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“We’ve always had to be at the leading edge of the next frequency band so we’ve stepped up and up in frequency as we’ve gone on. The latest is e-band, which is 71 gighertz to 81 gigahertz - a very high frequency design that is hard to manufacture. It requires very high tolerance manufacturing, and it’s very hard to do at any kind of volume. Realistically, we’re one of only a few companies in the world that can do that in the volumes that we can, and with the high yield. We’ve learned from our telecoms background.”
Being approached by SpaceX has been transformational for Filtronic - in the space of about two years taking it from a £16m turnover company to one that it is expected to reach £48m this year. The firm’s share price has also trebled since last year’s £48m ($60m) agreement - which could see SpaceX acquire a stake in Filtronic. Mr Williams says the rocket company’s ambition to be world number one drives rapid decision making and production schedules that has been the impetus behind the firm’s expanded facilities in the North East.
There’s similarly fast-paced growth taking place about 10 miles up the road from Filtronic at ally Pragmatic Semiconductor, albeit in a different part of the AME world. The chip maker is at the forefront of the regional job creation effort with its multimillion-pound creation of new manufacturing lines in County Durham for its ‘thinner than a human hair’ chips.
Its Pragmatic Park site in Meadowfield is said to be the first large-scale semiconductor manufacturing facility in the 海角视频 for several decades and it hosts the first state-of-the-art 300mm fab in the country. The firm will use the facility to produce billions of chips every year, using a process that is cheaper and faster than silicon counterparts, and is also possible with much smaller energy and water usage. Pragmatic has previously talked of its hopes to make the site a hub for partner companies and suppliers in the same or adjacent sectors.
That is likely to be music to the ears of the Compound Semiconductor Applications (CSA) Catapult, which in 2023 signalled its own faith in the North East cluster by setting up an office in its epicentre at NETPark. The catapult was set up in 2018 and is part funded by Innovate 海角视频 with a mission to help the 海角视频 become a global leader in compound semiconductors by offering expert knowledge and equipment to businesses and established a North East office in 2023 at NETPark
Already, the CSA Catapult - which is co-located with the Satellite Applications Catapult, has been involved in a number of projects in the region, including work with North East-based Inex Microtechnology and Viper RF to create compound semiconductor devices for use in future 5G networks and research with Gateshead-based Turbo Power Systems to use compound semiconductors to create solid state transformers that will be used in future energy networks. CSA Catapult is also host to equipment provided by Driving the Electric Revolution Industrialisation Centres (DER-IC), a network of over 30 universities and research and technology organisations of which Newcastle University is the lead organisation. DER-IC was granted funding from Innovate 海角视频 to support the industry to deliver the manufacturing technology needed to reach net zero and create a 海角视频-wide network of expertise in power electronics, machines and drives.
The ‘Advanced Material Electronics: Landscape map of the North East sector’ report points to exporting strengths with 44% of North East AME firms selling more than 60% of their products to international customers. The North East was also found to have produced 19% of the 海角视频’s total AME research outputs over the past 20 years. Those factors have put the regional cluster on a footing for projected growth of between £121.2m and £267.1m in the next five years. Getting there will require work to address barriers such as access to skills, funding and research capabilities - the report’s authors say.