Britain is the cradle of the “Industrial Revolution” and once firmly held the position of the “world's factory.” However, as developing countries revealed their advantage in cheap labor, manufacturing-dominated industry began to decline, replaced by services, finance and other sectors. UK manufacturing is now facing the objective situation of transformation to reverse its decline.

Data from the UK Office for National Statistics show that manufacturing accounts for only 15.2% of the UK's total economy. The financial crisis dealt a huge blow to Britain, which had relied excessively on the virtual economy. The UK government realized that only by also developing the real economy could economic development be stabilized, so “revitalizing manufacturing” was put on the agenda.

To promote the reshoring of manufacturing, the UK government introduced new economic development policies to increase the proportion of manufacturing in the economic structure. The UK government encouraged factories, production lines and businesses that had moved to other countries to return home. Prime Minister Cameron said at this year's Davos Forum that in recent years, one in every ten British small and medium-sized enterprises has moved part of its production capacity back to the UK, involving industries such as trains and automobiles.

The UK government attracts manufacturing reshoring through measures such as tax incentives. The UK tax system is highly attractive globally. In 2013, UK corporation tax was cut from 24% to 23%, far below the average level of around 30% in other countries. In terms of employer social security contributions, the UK also has an advantage over other countries, with rates less than half those of France and Italy.

It is noteworthy that the UK focuses on developing high-tech industries, high-end manufacturing and creative design industries, enabling services and manufacturing to complement and promote each other. In addition to traditional workshop production and mechanical operations, manufacturing employees are more engaged in supporting work such as R&D, design, sales and after-sales service.

Take the British domestic car brand Rolls-Royce as an example. Founded in 1906, this world-class luxury car manufacturer is not only a carmaker but also the world's leading engine manufacturer; Boeing aircraft use engines produced by the company.

Rolls-Royce maintains its leading position in the market not only through the excellent quality of its own products but also by cultivating customer loyalty through excellent after-sales service. It is understood that customers are allowed to participate in the design. In this way, customers not only enjoy the fun of design but also receive highly personalized exclusive products.

Rolls-Royce greatly respects customer culture and designs works that make customers feel close, or even moved. For example, when China became the world's largest buyer, Rolls-Royce, after in-depth research into Chinese culture, designed and produced products with strong Chinese aesthetic features such as the “Black-Red Phantom Series” and the “Dragon Series,” which are deeply loved by Chinese people.

Rolls-Royce also emphasizes technician training. The company provides strict training for every automotive technician. These technicians have the most innovative diagnostic and repair equipment, and they receive long-term training so that they can promptly master the cutting-edge technologies installed in Rolls-Royce cars. In addition, Rolls-Royce provides services such as roadside assistance and remote diagnostics.

Although several British car brands have changed ownership to other countries, the design and production of these cars still take place in the UK, and they have shifted from traditional manufacturing forms to high value-added fields. More than 40 well-known companies such as Ford, BMW, Toyota, Nissan and Honda have established operations in the UK, covering core automotive manufacturing links such as overall design, engine design and manufacturing, and key component production. In addition, the UK has strong international competitiveness in fields such as radar, jet engines, supersonic transport aircraft and military helicopters.

ARM is the world's leading provider of semiconductor intellectual property (IP), headquartered in Cambridge, UK. The company has established a new business model for microprocessor design, production and sales by licensing chip technology rather than producing or selling chips.

ARM has many IP licensing users, including the world's top semiconductor companies. The company has also developed various software that enables partner companies to obtain various software-based IP, operating system ports and software design services, thereby greatly reducing product development risks.

By increasing the added value of manufacturing, especially by promoting the added value of domestic manufacturing, UK manufacturing has shown obvious vitality on the road to revival and transformation, which is worth learning from.