EU Kicks Off Race to Produce Advanced Semiconductors by 2030

The European Union outlined the bloc’s digital goals for the next decade, including plans to develop and manufacture the world’s most advanced semiconductors by 2030, in an effort to reduce reliance on foreign companies for critical technological components.

Production of at least 20% of the world’s semiconductors in value is targeted by that date, the EU said Tuesday. Mature semiconductors are already produced in Europe, but officials want the region to manufacture chips that are faster than the most efficient currently made by industry leaders Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co.

The ambitious plan comes as Europe’s auto sector faces a shortage of chips needed to outfit modern cars with assisted driving, electrification and other technologies. While the issue may prove short-lived, it’s highlighted the region’s dependence on the U.S. and Asia for crucial pieces of tech.

Still, the EU’s efforts are already facing hurdles. Some semiconductor industry executives in Europe question whether demand exists in Europe for such advanced processors, and whether the EU is willing to invest the many years and billions of euros it would take to overhaul a global supply chain.

“We know that we will need more and more microprocessors,” for so-called internet of things but also for cloud and edge computing, EU Industry Commissioner Thierry Breton said at a press conference Tuesday. “That’s a big market,” he said, adding that targeting the production of semiconductors below the current cutting-edge 5nm nodes, “is really what I think we should do.”

The plans are extremely ambitious given the EU’s starting point, according to Frederico Mollet, an analyst at the European Policy Centre. “This doesn’t necessarily mean they shouldn’t be pursued, but it will be a long-term project, with considerable risk and expense attached,” he said.

The European Commission, the bloc’s executive body, didn’t provide any concrete details about how it would achieve that goal or the others outlined in its so-called Digital Compass on Tuesday.

The EU has discussed potentially establishing a new foundry or repurposing an existing one as part of the plan to boost semiconductor production in Europe, Bloomberg News reported previously. Breton on Tuesday said “we will have opportunities to do this,” adding that the EU may partner with companies that have the know-how to do so but that nothing has been decided yet.

EU Kicks Off Race to Produce Advanced Semiconductors by 2030

Other goals in the EU’s plan include:

  • To deploy climate-neutral decentralized cloud infrastructure to guarantee businesses access to data services in milliseconds by 2030.
  • To have the first computer with quantum acceleration in Europe by 2025.
  • For all populated areas to be covered by 5G by 2030.
  • For all key public services to be available online by 2030.

A monitoring system will be established to measure whether the EU and its member states are meeting the targets, and the commission said it would publish an annual progress report. The targets still need approval from both the bloc’s member states and the European Parliament.

©2021 Bloomberg L.P.

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