European chip ambitions face challenges; EU funding is insufficient for 2030 goals despite national efforts.
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The European Court of Auditors’ 2025 report urges Europe to awaken from its chip industry complacency to achieve its 2030 ambition of having 20 percent of globally sold chips manufactured within the EU. The auditor noted that current production capacity is far from this goal, requiring a nearly fivefold increase. Furthermore, the European Commission’s budget only covers about 5 percent of the estimated €86 billion needed by 2030, leaving the rest to member states and industry, which contrasts sharply with global R&D spending. The report also found that the objectives and monitoring of the chip law are unclear. Despite global demand for chips increasing, EU competitiveness is hampered by reliance on raw material imports, high energy costs, environmental concerns, geopolitical tensions, export restrictions, and a shortage of skilled labor. Financial support in the EU is heavily concentrated among a few large companies, making the sector vulnerable to single project failures. Moreover, projections suggest the EU’s share of the global value chain will only marginally increase from 9.8 percent in 2022 to 11.7 percent by 2030. Despite these challenges, various ambitious market and R&D initiatives exist across Europe, exemplified by ASML’s dominance in producing cutting-edge lithography equipment essential for global chip manufacturing, which is largely sourced from Taiwan. While some national efforts show progress—such as France funding STMicroelectronics expansion, Onsemi investing heavily in Eastern Europe, and Spain launching the PERTE Chip program—other initiatives face bureaucratic hurdles or technological gaps compared to Asian and American competitors.
