New satellite investment is a significant vote of confidence for the UK’s world leading space industry.

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A multimillion-pound investment in two new communications satellites has been announced by Eutelsat Communications and Airbus Defence and Space, in a move that could bring hundreds of highly skilled jobs to Portsmouth and Stevenage.

UK expertise has contributed significantly to the creation of 23 of Eutelsat’s 38 satellites currently in orbit.

The company is to replace its three existing satellites with two new ones set to launch in 2021. The new plans mean six of Eutelsat's next seven satellites will be partially built in Britain, representing an investment of up to €40m per year.

Eutelsat chief executive Rodolphe Belmer said: "I am delighted to sign this agreement with Airbus to build two new state-of-the-art satellites, cementing the long-standing partnership between our two companies.

"The agreement will see the manufacture of key parts of the new satellites at Airbus’ facilities in Stevenage and Portsmouth. These satellites will renew the in-orbit assets at HOTBIRD, Eutelsat’s largest video hotspot, ensuring our continued support to global broadcasters in delivering high quality video content and services throughout the UK and Europe.

"We are impressed with the ongoing expansion of the UK space sector, particularly its growing industrial capabilities and development of cutting-edge technology, and we will continue to rely on the UK’s ability to build and deliver world-leading spacecraft."

The Airbus UK facilities in Portsmouth and Stevenage will build the entire communications payload, platform structure, propulsion subsystem, antennas and various mechanisms for the satellites. Airbus employs more than 3,000 space engineers in the UK.

Colin Paynter, managing director of Airbus Defence and Space UK, added: "Airbus’ telecommunication satellite technology developed in the UK has been key to this significant contract win. UK Space Agency support for the ESA ARTES programme has enabled Airbus in the UK to develop world leading technology for the world’s leading satellite operators."

Business secretary Greg Clark hailed the agreement as a "significant vote of confidence for the UK's world leading space industry".