Europe is not particularly known as a major hub of the semiconductor world, but – if the European Commission gets its way – it will be. The Commission has launched a major seven-year drive to stimulate investment in the microelectronics and nanoelectronics manufacturing sector, aiming to ramp up to a fifth of global production by the end of the decade.
The news of the new EU industrial strategy came just a couple of days after the Geneva-headquartered, French-Italian manufacturer STMicroelectronics launched its own three-year project, worth €360 million ($463 million), aimed at creating a European microelectronics design ecosystem based around its fully-depleted silicon-on-insulator (FD-SOI) manufacturing process.
Some in the industry, such as chipmaker GlobalFoundries, have previously urged European authorities to back electronics manufacturing on the continent in order to counteract the vast influence of Asia and (to a lesser extent) the U.S. in this field.
Cheaper, faster, smarter
The European Commission’s strategy, announced on Thursday, is intended to make chips cheaper, faster and smarter. It will concentrate on shoring up three existing electronics clusters, namely those in Dresden (Germany), Eindhoven (Netherlands) and Leuven (Belgium), and Grenoble (France). Connections will also be made with other clusters such as that in Cambridge (UK), which is big in the wireless sector.
“I want to double our chip production to around 20 percent of global production,” Digital Agenda Commissioner Neelie Kroes said in a statement. “I want Europe to produce more chips in Europe than the United States produces domestically. It’s a realistic goal if we channel our investments properly.”
As per usual, this isn’t a simple public cash splurge. €5 billion in public funds – 30 percent from the EU with the rest coming from national and regional funds – will go to R&D, in order to help stimulate the sector. Overall, the Commission says, industry has indicated it will stump up €100 billion over the seven years: €15 billion in capital expenditure and €85 billion in operational costs.
The kind of electronics we’re talking about could be used in desktop and handheld computers, but the main thrust is for embedded systems and “internet of things” devices, from sensors and smart grids to new healthcare technologies. As Kroes said in a speech, “this isn’t about computers.”
Targeting these areas plays to Europe’s strengths. According to the Commission, Europe already pumps out half of global automotive electronics, 40 percent of electronics used in energy applications, and 35 percent of those used for industrial automation – this will be a reference to the output of companies such as Bosch, which are hugely active despite often being somewhat under-the-radar. Then we also have smaller manufacturers working in high-growth niches, such as health implants and sensors.
The purpose of all this is to make Europe less reliant on manufacturers outside the continent, but job creation is also a major factor. The Commission reckons the European electronics industry already employs 200,000 people directly and supports a further million jobs indirectly.
That said, the Commission also pointed out in its statement that demand for skilled workers in these fields is higher than supply – if this whole strategy is to work, the implication runs, Europe will need to attract more skilled workers. The statement talks of coordinating public efforts across Europe. Perhaps that will mean tweaking immigration rules: something the U.S. tech sector is also heavily vocal about these days.
Meanwhile, STMicro’s push – called, incredibly, “Pilot Lines for Advanced CMOS Enhanced by SOI in 2x nodes, Built in Europe” (Places2Be) – also takes place in the context of a wider European project, the nanoelectronics-focused ENIAC. In a briefing note accompanying Thursday’s announcement, the Commission insisted that ENIAC and ARTEMIS (another project focusing on embedded computing) had been a success, and that the new drive did not denote failure of those two schemes.
The Commission said the new joint undertaking would build on “lessons learnt” from ENIAC and ARTEMIS while providing a “simplified funding structure”.