Through its Modern Industrial Strategy published in 2025, the UK has set out a 10-year roadmap built around a key objective: positioning the country as the world’s destination of choice for investment and development in the industrial sector.
As part of this plan, the British government has made a clear choice: to focus its efforts on eight high-potential sectors representing 32% of national GDP. Among them, advanced manufacturing, which notably includes aerospace, advanced materials, batteries and automotive, occupies a prominent position.
For the 2025–2026 period alone, no less than £20.4 billion has already been committed to strengthening the country’s innovation ecosystem and industrial capabilities in these areas.
£500 million for the “R&D Missions Accelerator Programme”
This funding is deployed through several targeted programmes: £500 million for the R&D Missions Accelerator Programme, designed to address national industrial challenges; up to £500 million for the Local Innovation Partnerships Fund, which supports regional players; and £29 million per year until 2030 to encourage digital adoption in industry through the Made Smarter Innovation programme.
Specific areas also benefit from dedicated funding envelopes: £4.3 billion over five years to promote innovation, automation, digitalisation and commercialisation; £2 billion for the automotive sector (zero-emission vehicles, batteries and supply chains, etc.); £2.3 billion via the Aerospace Technology Institute for energy-efficient aerospace technologies from 2025 through to 2035; and £200 million for the agricultural innovation programme aimed at developing agri-tech.
Safran opens its first research entity outside France
The attractiveness of the UK ecosystem in these areas is illustrated by the recent announcement from Safran, now the third-largest civil aerospace player in the UK. In December 2025, the French group created Safran Tech UK, its first Research & Technology entity outside France.
“The launch of Safran Tech UK, our first research entity outside France, reflects our ambition to make the UK a catalyst for innovation in the decarbonisation of aviation,” explains Olivier Andriès, CEO of Safran. “As the third-largest civil aerospace player in the UK, we are proud to contribute to the vitality of the country’s industry and its research ecosystem.” Safran now employs more than 5,500 people across 14 UK sites, generating annual revenues of £1.5 billion.
This new entity, Safran Tech UK, will focus on two strategic areas: the electrification of propulsion and actuation systems for next-generation aircraft, and high-performance composite materials.
Schneider Electric invests £42 million in North Yorkshire
Another major French group is showing similar ambition across the Channel: Schneider Electric, a global specialist in intelligent energy management and automation.
In September 2025, Schneider officially opened its new “Net Zero” factory in Scarborough, which will create more than 200 jobs, in order to meet growing demand for electrical equipment supporting the UK’s energy transition, including renewable energy, electric vehicles and smart, energy-efficient buildings.
At the announcement, Jonathan Reynolds, Secretary of State for Business and Trade, welcomed this major investment, noting that the UK’s “commitment to becoming a clean energy superpower is unwavering,” before adding that “investments like this one in North Yorkshire make a huge contribution to strengthening the UK as a leader in energy management and automation.”
The President of Schneider Electric UK also stated: “The UK manufacturing sector is essential to the development of the country’s infrastructure. With electricity demand expected to reach record levels, our Scarborough site, building on Yorkshire’s expertise, gives us the scale and responsiveness needed to react quickly to market developments and support the UK’s energy transition, and beyond. By strengthening our local presence, we are working even more closely with our customers to deliver a decarbonised and resilient future.”
A pool of highly skilled talent
Among the factors likely to attract international investors such as Safran and Schneider Electric, the quality of the talent pool ranks highly. The UK industrial sector already employs 2.6 million people, while the country performs strongly in global rankings for university quality and overall skills, such as those published by INSEAD. Another attractive factor: on average, base salary costs are 29% lower than in Germany for an engineer and 17% lower than in France.
In addition, the UK counted 1.32 million students in STEM (Science, Technology, Engineering and Mathematics) fields in 2023–24. To sustain this competitive advantage and anticipate technological change, the National Manufacturing Skills Taskforce coordinates efforts to ensure the industrial sector has the talent required to lead the next phase of technological innovation, while centres of excellence have been established. One example is the High Value Manufacturing Catapult, dedicated to accelerating innovation in industry and bringing together more than 3,700 of the country’s top engineers, scientists and technicians.
In parallel, initiatives such as Skills Bootcamps and Industry Pathfinders, flexible training programmes delivered by Institutes of Technology, offer upskilling pathways tailored to industrial needs.
An attractive environment for R&D
From a tax perspective, the UK environment is equally competitive. In particular, the corporate tax rate, set at 25%, is the lowest in the European G7. Companies specialising in R&D benefit from a reduced tax rate of 19%. In addition, innovative companies can take advantage of the Patent Box scheme, which lowers the tax rate on profits derived from patents.
Finally, to facilitate investment, the UK government created the Office for Investment in 2020 to support and assist both international and domestic investors. This one-stop shop offers personalised services including market analysis, support in identifying co-financing opportunities, introductions to partners, advocacy with public authorities, and post-investment follow-up.
The Trade Services team at the British Embassy in Paris supports French companies in their expansion projects. Click here to find out more.
