Interesting article here from Bloomberg. Seems like EU also entering the Semi manufacturing race, just like China and the US. At least this might trigger the subsidies ST Micro has been waiting for to invest with PVA Tepla, but lets see if Aixtron can benefit as well.
Regards,
Fel
Europe Looks to Secure Chip Supply After ‘Naive’ Past Approach
2021-05-05 04:00:00.11 GMT
By Natalia Drozdiak
(Bloomberg) -- Europe was naive to outsource so much of its
semiconductor design and manufacturing in recent decades, a top
government official said ahead of unveiling more details around
plans to double the region’s chip production by 2030.
European Industry Commissioner Thierry Breton said it was
possible to redress the imbalance, and the global chip shortage
hobbling automakers and electronics suppliers was evidence that
now is the time to act.
“We want to come back to our former market share of
production for the needs of our industry,” said Breton, the
former chief executive officer of French IT giant Atos SE and
France Telecom SA. Europe’s share of semiconductor manufacturing
has dropped over the years because the region has been “too
naive, too open,” he added in an interview.
On Wednesday, the European Commission, the bloc’s executive
body, will unveil more details about a strategy announced in
March to double production to at least 20% of the world’s chips
by 2030. It will involve creating an industry alliance of
Europe’s leading semiconductor companies and research centers as
well as more than a dozen EU governments, Breton said. At least
22 countries have already signed a letter of intent.
Read More: How a Chip Shortage Snarled Everything From
Phones to Cars
The alliance of European players will have to decide how to
boost the design and production of 20-nanometer to 10-nanometer
chips, which are smaller and more powerful than most currently
manufactured in Europe, Breton said, without offering a
timeline. Advances in manufacturing are measured in nanometers,
or billionths of a meter, with smaller and smaller transistors
crammed onto silicon wafers with each new iteration.
In parallel, the EU will work on plans to produce the next
generation of leading edge chips by 2030. Officials are
targeting production below 5-nanometers down to 2-nanometers, an
ambitious goal not yet reached by industry leaders Taiwan
Semiconductor Manufacturing Co. and South Korea’s Samsung
Electronics Co.
Read More: EU Kicks Off Race to Produce Advanced
Semiconductors by 2030
For years, Europe accounted for a major chunk of global
semiconductor manufacturing. In 1990, capacity reached about 44%
but it’s now closer to 10%. Taiwan, South Korea and Japan
account for about 60% of production, according to Boston
Consulting Group and the Semiconductor Industry Association.
European chip designers including NXP Semiconductors NV and
Infineon Technologies AG now outsource most production to TSMC
and other foundry operators.
Europe’s decline in consumer technology, such as the failure of
Nokia Corp. and Ericsson AB’s once-popular mobile phones, is
partly to blame for the supply chain shift, according to Jan-
Peter Kleinhans, head of technology and geopolitics at think
tank Stiftung Neue Verantwortung.
While Europe’s auto industry is still strong, the sector
has been one of the hardest hit by the global chip shortage.
Ford Motor Co. said Monday it would halt production at its
German plants for several weeks due to a lack of semiconductors,
joining a growing list of manufacturers idling factories.
The crisis has underscored the region’s dependence on
foreign companies for critical supplies and is driving the EU’s
ambition to regain self-sufficiency in the area. But the EU’s
plan to go below 5-nanometer production is so ambitious that the
bloc will need help from overseas foreign players like TSMC,
which dedicated years of research and invested billions of
dollars to develop their production expertise.
“We know that to go there, it will be better to do this with
partners,” Breton said of the ambitious 2-nanometer goal,
referring to the strategy as “going to the moon.”
Europe Is Trying to Reclaim Its Lost Chipmaking Glory
Intel Corp., the world’s largest chipmaker, has backed the
EU’s plans. It’s already expanding 7-nanometer production in
Europe and is also considering building a state-of-the-art
semiconductor foundry in the region. But the company has
struggled to advance its manufacturing in recent years. Intel
Chief Executive Officer Pat Gelsinger last week also suggested
the company would likely need hefty financial support from
European governments to invest in the bloc’s strategy.
An Intel spokesman pointed to companies in Asia that get
roughly 40% of the costs of building a new factory subsidized by
the state. A new factory costs at least $10 billion and it would
take two of them in one location to take advantage of economies
of scale, the spokesman said.
It remains unclear how much money Europe is willing to spend to
reclaim its chipmaking prowess. Still, around 19 member states
have already backed the commission’s plans and have agreed to
establish an investment instrument co-financed by the countries
and participating companies. At least 20% of the EU’s 672.5
billion-euro ($808 billion) recovery and resilience facility has
also been allocated for digital priorities, though it’s up to
individual countries to decide how much to spend specifically on
the semiconductor strategy.
“The EU has some semiconductor industry champions, but it
faces fierce competition from other countries that view chip
production as a national priority,” Gelsinger wrote in the
Financial Times last week, adding that those governments are
providing generous incentives to attract semiconductor
manufacturing.
“Europe must match this to stand a chance of competing,” he
said.
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