From electric cars to smartphones, wind turbines and even rockets, chips are the “oil of the 21st century” and components “everything depends on them”, as German Chancellor Olaf Scholz said during the opening of a new factory for the German manufacturer Infenion. May’s beginning.
Scholz spoke about semiconductors with the Koreans during a weekend visit to Seoul, urging them to invest in Europe to strengthen supply chains.
The EU’s stated goal is to reach 20% of the global market by 2030, double what it is today. For this, it will take four times more production on the old continent.
This is the objective of the European “chip law” concluded in April, which provides for the allocation of 43 billion euros in public and private investment.
Europe’s largest economy wants to lead this movement to reduce dependence on Asia. In addition to the new Infineon factory in Dresden – a five billion euro project – the American groups Intel and Wolfspeed have announced major investments in Germany in recent months.
Taiwanese in Dresden?
Germany will strike a blow if it manages to host the first European factory of the Taiwanese group TSMC, one of the largest chip manufacturers in the world.
Talks have been underway for more than a year to set up a factory in the Dresden region, Europe’s leading center for microelectronics, known as “Silicon Saxony”. A decision on this is expected in August, according to TSMC.
But about 200 kilometers away, in the Magdeburg region in particular, doubts have replaced the place of euphoria aroused by the announcement last year of the American giant “Intel” to invest 17 billion euros, while the construction of the plant, which was to start in the first half of 2023, has not started.
The group, which posted a record quarterly loss at the start of the year, said in a statement to AFP that “a lot has changed” in one year, when it suffered a sharp drop in computer sales personal. and smartphones.
The group explains that in addition to “geopolitical challenges…turmoil in the global economy has led to increased costs, from building materials to energy.”
For its part, the Ministry of the Economy indicates that additional public aid should “fill the gap in the cost of the planned project, which has increased considerably”.
Not self-sufficient
However, this race for subsidies sometimes raises concerns. “We are spending a lot of money…to increase the security of supply a bit,” says Clemens Fuest, one of the country’s well-known economists.
And while public aid, in Dresden or Magdeburg, will amount to billions, Germany and Europe will still be very dependent on chips produced outside the continent, and “you have to imagine what we could have done with this money”, says Fuest, who directs the Institute of Economic Studies “IFO” in an interview with the channel “IRD” recently.
For his part, Infineon CEO Jochen Hannebeck warned on a conference call this month that while semiconductor dependencies can be reduced, there will be no “self-sufficiency for any country or region” in this sector.
On the other hand, many workers in the sector believe that the aid should be more massive. “The funds announced under the Chip Act are a good start, but they are still insufficient by international standards,” Frank Bozenberg, director of Silicon Saxony, the developer of the chip, told AFP. the semiconductor industry in the Dresden region.
Taiwan (where 90% of the world’s most advanced semiconductors are produced), South Korea and, increasingly, China, currently dominate the market.
On the other hand, Europe has to face competition from the United States, which spends large sums to stimulate national production.
Another major challenge for Germany is finding enough workers. According to a study conducted by the German Economic Institute in December, there is currently a shortage of qualified employees amounting to 62,000 employees in the various professions that fall within the scope of the chip industry.
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