Europe is looking to secure chip supplies away from Asia

0
15


A senior European official said that in past decades the outsourcing of the manufacture and design of most semiconductors had been “the naivety of Europe.” These statements came before the disclosure of more details about plans to double the region’s production of chips by 2030.

The defect can be remedied, said Terry Britton, Commissioner for Industry in the European Union, and the global shortage of chips hindering carmakers and electronics suppliers is evidence that it is time to act.

“We want to return to our previous market share of production to meet the needs of our industry,” said Breton, former CEO of French information technology giant Atos SE and French telecom company, in an interview with Bloomberg. The conductors have slipped over the years, because the area was “too naive, too open.”

The European Commission – the bloc’s executive arm – is set to reveal more details about a strategy announced in March to double production to at least 20% of global chip production by 2030, which includes the creation of an industrial alliance between Europe’s leading semiconductor companies and centers Research, more than a dozen governments in the European Union, and at least 22 countries have already signed a letter of intent.

Breton said – without providing a timetable – that the European Players Alliance will decide how to enhance the design and production of the “20 nanometer” chips to “10 nm”, which are smaller in size and more powerful than most of the chips currently manufactured in Europe, and that progress in manufacturing is measured in the “nanometer” unit. , Or billionth of a meter, with smaller, interconnected conductors between silicon wafers in each layer.

Ambitious goals

The European Union will work in parallel on plans to produce the new generation of more advanced chips by 2030, and officials are targeting the production of 5-nanometer to 2-nm chips, an ambitious goal that has not yet been achieved by leading companies in the sector such as the Taiwan Semiconductor Industry Corporation. And Samsung Electronics, South Korea.

For years, Europe was a large part of the global semiconductor industry, and in 1990, its production capacity reached about 44% of global production, but now it is close to 10%.

Taiwan, South Korea and Japan account for about 60% of production, according to the Boston Consulting Group and the Semiconductor Industry Association, and European chip designers such as NXP Semiconductors NV and Infineon Technologies are doing the same. AG) has outsourced most of the production to TSMC and other foundries.

Peter Kleinheis, head of technology and geopolitics at the Research Center (Stiftung Neue Verantwortung), believes that Europe’s decline in consumer technology products, which is embodied in the failure of the previously popular Nokia and Ericsson AP phones, is partly produced. On the supply chain transformation.

Although the European auto sector is still strong, it has been one of the sectors most affected by the global chip shortage. Ford Motor Company said on Monday that it would halt production at its German factories for several weeks due to a semiconductor shortage, to join a growing list of Broken factories.

Going to the moon

The crisis highlighted the region’s dependence on foreign companies for vital supplies and led the European Union’s ambition to regain self-sufficiency, but its plan to produce chips less than “5 nanometers” is so ambitious that it will need help from foreign players such as TSMC, which has devoted itself to Years of research, and has invested billions of dollars to develop its production expertise.

“We know that getting there requires partners,” Britton said of the goal of making “2nm” chips, referring to the strategy as “going to the moon.”

Intel, the world’s largest chip maker, has supported the European Union’s plans, and is already expanding its production of 7-nanometer chips in Europe, and is also studying building an advanced semiconductor foundry in the region, but the company has struggled to develop its manufacturing over the years. Last week, its CEO, Pat Gelsinger, indicated that the company likely needs massive financial support from European governments to invest in the bloc’s strategy.

An Intel spokesperson indicated that companies in Asia receive about 40% of the costs of building a new factory from the country, adding that the new plant costs at least $ 10 billion, and it requires two factories in one place to take advantage of economies of scale.

It is still unclear how much money Europe is willing to spend to regain its leadership in the chip industry, yet 19 member states have already supported the Commission’s plans and agreed to create an investment tool co-financed by the participating countries and companies.

At least 20% of the EU’s recovery and flexibility mechanism worth € 672.5 billion ($ 808 billion) has been earmarked for digital priorities, but it is up to individual countries to decide how much they want to spend specifically on the semiconductor strategy.

“The European Union has some semiconductor industry leaders, but it is facing fierce competition from other countries that view chip production as a national priority,” Gelsinger wrote in the Financial Times last week, adding that these governments provide generous incentives to attract semiconductor manufacturers. “Europe must match that, in order to have a chance to compete,” he said.







LEAVE A REPLY

Please enter your comment!
Please enter your name here