ESIA Urges Increased Funding and Support from European Chips Act 2.0

An ESIA statement highlighted the importance of revising European chip policy to reduce export restrictions, as reported by Reuters. ESIA, representing major European chip companies like Infineon, NXP, ST, and AMSL, along with research institutes such as IMEC, Fraunhofer, and CEA-Leti, called for the immediate implementation of a "Chips Act 2.0."

The initial European Union Chips Act, which came into effect in September 2023, had a budget of €43 billion sourced from national governments. The primary objective was to double Europe's global chip manufacturing share to 20 percent by 2030.

Recently, the European Chips Act underwent amendments and approvals. The European Commission sanctioned German plans to support the construction and operation of a wafer fab, with half of the estimated €10 billion cost allocated. Ground was broken in August for the European Semiconductor Manufacturing Co. (ESMC).

However, Intel's US$32 billion project to establish two wafer fab buildings in Magdeburg, Germany, faces uncertainties. Intel's financial losses have prompted a reassessment of strategic options, leading to potential delays. The timeline for Intel in Dresden has been extended, awaiting European Union approval for subsidies of around US$10 billion from the German government.

Meanwhile, ST and Globalfoundries have entered into a partnership to develop a subsidized wafer fab near Grenoble, showcasing collaborative efforts within the European chip industry.

The ESIA also criticized the lack of support for chip companies encountering barriers in accessing Chinese markets for their products. The ESIA emphasized the need for a proactive economic security approach based on support and incentives rather than restrictive measures, as stated in the Reuters report.