The German Electro and Digital Industry Association (ZVEI) has urged the EU to promote investment in semiconductor industry at its recent semiconductor press conference. “The global semiconductor market will double to around one trillion US dollars by 2030. Although the semiconductor market is currently exhibiting typical cyclical behaviour, with overcapacities being built up in the short term, the chip rally of recent years is not yet nearing its end,“ Robert Kraus, Chairman of the ZVEI Semiconductor Division and CEO Inova Semiconductors said at the ZVEI event.
The organisation also said it believes that the demand for chips will remain high – especially in the automotive and industrial markets – with Kraus pointing out that further digitization and sustainability measures such as CO2-reducing technologies would drive high growth in the long term. In 2022, chips worth USD 580 billion were produced worldwide, but only just under ten percent of that in Europe.
Speakers at the event urged Europe to follow the lead of other regions in promoting technological sovereignty and competitiveness in semiconductor manufacturing.
“Europe runs the risk of being left behind if, among other things, the measures in the EU Chips Act are carried out too late,’ said Wolfgang Weber, Chairman of the ZVEI Board of Management. “Europe will hardly be able to maintain its position as a semiconductor region – let alone expand its own share of global production – if the necessary conditions for investment in Europe are not put into place immediately,“ . The EU Chips Act, which aims to double Europe‘s share of the global semiconductor market to 20 percent by 2030, was announced in autumn 2021. The Act is expected to be adopted this year.
Benchmark for Europe should be US Chips and Science Act
According to ZVEI, the benchmark for Europe should be the US Chips and Science Act, which will provide over USD 200 billion for semiconductor manufacturing and R&D. Europe meanwhile is planning mobilise around EUR 43 billion for the EU Chips Act. ZVEI believes that the EU Commission has so far relied almost exclusively on support from member states. Without significant additional investment from other public sources, including through the announced European Sovereignty Fund, and without investment incentives for the private side, Europe will miss its 20 percent target and further weaken Europe as an investment location, despite the European Chips Act. Europe now needs a policy that promotes investment in a targeted manner. “The goal must be to develop an internationally competitive microelectronics ecosystem in Europe,” Weber said. ‘To achieve this, the EU must now implement the Chips Act … with the highest priority and stimulate investment in the semiconductor industry.“
