Market Overview
The United Kingdom semiconductor market size reached USD 22,887.9 Million in 2024. It is expected to grow to USD 41,431.7 Million by 2033, at a CAGR of 6.82% during the forecast period 2025-2033. This growth is primarily driven by increasing demand for advanced chips used in AI, machine learning, and IoT applications, along with the rollout of 5G technology. Investments in domestic manufacturing and government support have positioned the UK as a key player globally. Refer to the United Kingdom Semiconductor Market for details.
Study Assumption Years
- Base Year: 2024
- Historical Year/Period: 2019-2024
- Forecast Year/Period: 2025-2033
United Kingdom Semiconductor Market Key Takeaways
- The UK semiconductor market size was USD 22,887.9 Million in 2024.
- The expected CAGR during 2025-2033 is 6.82%.
- The forecast period for market growth is 2025-2033.
- The surge in demand is influenced by advancements in AI, machine learning, and IoT technologies.
- The deployment of 5G technology is creating significant semiconductor demand, especially for telecommunications infrastructure.
- Government initiatives include a $1.6 billion investment in the Semiconductor Institute and a £16.6 million sanction for EV and clean energy semiconductor research.
- The rollout of 5G networks requires advanced chips that support higher data rates, reduced latency, and enhanced connectivity.
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Market Growth Factors
The use of 5G technology in the UK is a major driving factor for the growth of the semiconductor industry. 5G technology results in a surge in demand for advanced semiconductors, which are paramount for communication infrastructure and smartphones. Vodafone UK and Three UK's joint venture to implement 5G SA technology aims to deliver 50% coverage for 5G not-spots within rural areas of Wales, helping to support emergency services, agricultural technology, and competitive mobile services. The use of these semiconductors enhances processing speed, bandwidth, and power efficiency, which are core requirements for communication infrastructure and smartphones supporting 5G technology.
The increasing demand for more advanced semiconductors like GPUs and AI acceleration is driving the rise of AI, machine learning use cases, and the use of IoT. IoT devices like smart home items, industrial sensors, and wearables need semiconductors that are power-efficient with the ability to perform specialized functions. The convergence of connectivity, sensing, and computation in semiconductors makes data sharing effortless between IoT components.
Government backing and investment are important factors in fueling market expansion. In May 2024, the UK government allocated $1.6 billion to the Semiconductor Institute to integrate the industry and accelerate semiconductor science research. Moreover, a budget of £16.6 million has been authorized in March 2024 to conduct semiconductor research related to electric-powered cars and clean energy as a part of its semiconductor strategy with a budget of £1 billion. The budget allocated for power electronics research helps businesses and scientists in Newcastle and Strathclyde to explore innovations in semiconductor packing and sustainability and semiconductor-related production assembly automation.
Market Segmentation
Components Insights:
- Memory Devices, Logic Devices, Analog IC, MPU, Discrete Power Devices, MCU, Sensors, Others: The market includes these core semiconductor components driving various technology applications.
Material Used Insights:
- Silicon Carbide, Gallium Manganese Arsenide, Copper Indium Gallium Selenide, Molybdenum Disulfide, Others: The report details breakdown based on these specialized semiconductor materials enhancing device performance.
End User Insights:
- Automotive, Industrial, Data Center, Telecommunication, Consumer Electronics, Aerospace and Defense, Healthcare, Others: These sectors represent the major end users of semiconductors in the UK.
Regional Insights
The report covers major UK regions including London, South East, North West, East of England, South West, Scotland, West Midlands, Yorkshire and The Humber, East Midlands, and Others. Specific regional market shares or CAGR data are not provided, but the segmentation indicates a comprehensive geographic distribution spanning all key economic areas.
Recent Developments & News
In May 2024, the UK government allocated $1.6 billion to the Semiconductor Institute to support national semiconductor industry growth and skills development. In March 2024, £16.6 million was sanctioned for semiconductor research related to electric vehicles and clean energy, under the £1 billion semiconductor strategy. Approximately £14 million will focus on power electronics innovation in Newcastle and Strathclyde, supporting packaging advancements and automation in assembly processes. Vodafone UK and Three UK announced their merger and deployment plan for 5G Standalone technology to cover rural Wales’ 5G not-spots.
Competitive Landscape
The competitive landscape of the industry has also been examined along with the profiles of the key players.
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