Some of the most advanced CPUs may soon be produced in Europe. The European Commission approved the ‘Chips for Europe’ programme this week, under which the EU and local governments will invest over €40 billion in the semiconductor industry by 2030 to help resuscitate local chip manufacturing. Surprisingly, the Taiwanese government was one of the first to cheer the action, despite the EU considering assisting Taiwan Semiconductor Manufacturing Co. in building a fab in Europe.
Collaboration with semiconductor industry titans such as Intel and TSMC is an excellent method for Europe to boost local chip production. While Intel is looking for a place for its next production facility in mainland Europe, TSMC began looking at Germany as a possible home for its first European fab last year. Taiwan is particularly included in the new European semiconductor roadmap as one of the bloc’s ‘likely minded partners.’
The Chips for Europe programme, also known as the EU Chips Act, proposes investing €11 billion in pilot lines and design platforms required to transport cutting-edge semiconductor process technology from the lab to the fab (from EU and member state budgets) until 2030.
Furthermore, the concept calls for member states to invest €30 billion in a new significant project of common European interest (IPCEI) and mega fabs, which are semiconductor manufacturing facilities capable of producing over 25 thousand wafer starts each month. The EU must relax its restrictions to allow member state governments to offer such incentives.
In Europe, several companies already produce chips. GlobalFoundries’ Fab 1 is located near Dresden, Germany, and it manufactures automotive chips as well as low-power devices using its FD-SOI nodes. Intel plans to create its cutting-edge processors utilising its Intel 7 and Intel 4 fabrication techniques at a fab near Leixlip, Ireland.
Chips are also made in Germany, France, and Italy by Infineon and ST Microelectronics businesses. However, Intel and GlobalFoundries have the most modern fabs, and the EU considers that these are insufficient to fulfil rising chip demand, necessitating the construction of additional semiconductor manufacturing facilities.
Intel will most likely develop a leading-edge Intel 25A and Intel 18A-capable fab in mainland Europe, which will be a breakthrough for the EU, which has been lagging behind Taiwan and the United States in terms of chip production for well over a decade.
With TSMC, the picture appears to be very different. According to the corporation, there aren’t enough clients for cutting-edge fabrication technology in Europe, therefore it’s pointless to develop a suitable fab there. Meanwhile, because automakers and other customers rely on trailing-edge nodes, it makes sense to construct a facility just for them. While a fab like this would not increase Europe’s semiconductor capabilities, chips are important to automakers, and automakers are critical for the economy.
It’s important to note that no formal decisions about which firms to support or which activities to fund have been made yet, thus the EU Chips Act is currently just a declaration of purpose rather than a set of actual projects that the EU and member states would pay.