The European Semiconductor Industry Association (ESIA) endorsed the European Commission’s Tech Sovereignty Package and Chips Act 2, but warned that political ambition must now translate into industrial execution.
Strategic shift toward industrialization
The new package builds on the 2023 EU Chips Act, acknowledging semiconductors as foundational to AI, energy, defense, mobility, and industrial automation. ESIA specifically welcomes stronger demand-side measures and a broader focus on the full semiconductor ecosystem, including supply-chain resilience. The package recognizes that chips will be decisive in future technologies, not just in advanced nodes but across foundational technologies.
From regulation to competitiveness
“Europe cannot regulate its way into semiconductor leadership,” said ESIA President Erik Rein, also an executive at Bosch. He stressed that the global race will be won by those who innovate and industrialize fastest, adding that Chips Act 2 must become a true industrial competitiveness strategy. ESIA argues that Europe’s strength lies in Edge AI, power semiconductors, sensors, automotive electronics, and secure communications—areas where it already holds industrial advantages.
Ecosystem approach and administrative barriers
ESIA urges expanding ‘first-of-a-kind’ (FOAK) projects beyond manufacturing fabs to include end-users across the entire value chain. A narrow fab focus may address supply security, but it is insufficient for the ecosystem to thrive. At the same time, Europe’s competitiveness gap persists due to lengthy permitting, fragmented regulation, high energy costs, and inconsistent state-aid rules. “Semiconductor innovation cycles move in months, not years,” Rein noted, calling for approval timelines that match industrial speed.
Need for structured dialogue
The association calls for a permanent high-level dialogue between industry and policymakers within the European semiconductor governance framework, which the current proposal does not fully detail. “Europe already has world-class semiconductor champions,” Rein concluded. “What Europe now needs is a world-class industrial policy environment.”
The coming legislative process will determine whether Europe can convert its semiconductor strategy from a policy document into a competitive industrial reality. Success hinges on speed, simplification, and ecosystem-wide coordination.
