A Dutch semiconductor startup has announced what it describes as an 'all-European' design and manufacturing process for its satnav components, a claim that has drawn attention given the intricate global landscape of chip production. While the design and initial stages are indeed based within the European Union, the crucial manufacturing step, known as fabrication or 'fab' work, is being carried out by GlobalFoundries. Although GlobalFoundries is headquartered in the United States, it operates significant production facilities in Europe, including a large plant in Dresden, Germany.
This development is set against a backdrop of intensified global competition and strategic efforts by regions, including the EU and the UK, to bolster their domestic semiconductor industries. The push for greater self-sufficiency in chip production has been driven by supply chain disruptions experienced during the pandemic and geopolitical tensions. The European Chips Act, for instance, aims to double the EU's share in global chip production to 20% by 2030, supported by substantial public and private investment.
For UK businesses and consumers, the robustness of the global semiconductor supply chain is paramount. Chips are integral to virtually every modern electronic device, from smartphones and cars to industrial machinery and critical infrastructure. A more diversified and resilient supply chain, even one that involves strategic international partnerships, could help mitigate future shortages and price volatility. However, the reliance on a US-headquartered firm for a key manufacturing stage in what is presented as an 'all-European' flow illustrates the deep integration and interdependence within the global semiconductor ecosystem.
The UK, through its National Semiconductor Strategy launched in 2023, is also seeking to strengthen its position in the global chip market, focusing on areas of design, intellectual property, and compound semiconductors. While the UK's strategy does not aim for large-scale 'mega-fab' production like some other regions, it emphasises collaboration and leveraging existing strengths. The Dutch startup's approach highlights a potential model where European design expertise is combined with established global manufacturing capabilities, rather than attempting to build entirely new, fully integrated domestic supply chains from scratch.
Expert commentary often points to the immense capital expenditure and technical expertise required to establish and run advanced semiconductor fabrication plants. Building a completely independent, regional end-to-end supply chain for all types of chips is an extraordinarily challenging and costly endeavour. Therefore, strategic partnerships and leveraging existing infrastructure, even from companies headquartered outside the immediate region, are often seen as pragmatic steps towards enhancing supply chain resilience and fostering innovation within Europe.
The regulatory context, particularly the EU AI Act, while not directly addressing chip manufacturing, underscores the broader European ambition to control critical technologies and their underlying components. While the Act focuses on the ethical use and deployment of Artificial Intelligence, the availability and security of the chips that power AI systems are an implicit concern. The UK's approach to technology regulation, including through the Information Commissioner's Office (ICO), similarly aims to foster innovation while ensuring security and responsible use of data, all of which depend on reliable access to advanced semiconductor technology.