10. Semiconducter

Question 1

What is the european Chips Act?

Answer 1

A plan by the EU to boost its semiconductor industry. It aims to reduce reliance on imports by investing in chip research, design, and manufacturing, making Europe more self-sufficient.

Question 2

What could go wrong with the european chips act?

Answer 2

• No Demand: European companies don’t design enough cutting-edge chips to justify these fabs.
• Hard to Compete: Dominated by Samsung and TSMC, the market for advanced fabs is extremely costly and hard to enter.
• Better Focus: The EU should first invest in chip design to create demand, then think about manufacturing.
• EU risk investing billions of euros with little benefit

Question 3

What is the difference between the US and EU chips act?

Answer 3

EU Chips Act: Focuses on research, innovation. (allocated $43 billion)
US Chips Act: Focuses more on boosting domestic advanced manufacturing and attracting global leaders like TSMC and Samsung to build fabs in the U.S. (allocated $52 Billion)

Question 4

What are the strength of each act?

Answer 4

EU: Strong in equipment, research, and automotive-related chips.

US: Dominates advanced chip design and cutting-edge manufacturing.

Question 5

What are the strength and weakness of the EU chips act?

Answer 5

Strength: Builds a full ecosystem and supports automotive chips.
Weakness: Lacks focus on advanced fabs; progress is slow.

Question 6

What are the strength and weakness of the US chips act?

Answer 6

Strength: Focuses on cutting-edge fabs and local manufacturing.
Weakness: Focuses too much on fabs; depends on foreign firms.

Question 7

If I was In charge of the European Chips Act, what would I do and why?

Answer 7

1. Help Start New Chip Companies
   - Europe needs more chip designers to boost factory demand.
2. Upgrade Factories for Everyday Chips
   - Europe can lead in making simpler chips for cars and machines.
3. Make It Easier for Countries to Work Together
   - Simplifying rules can speed up big projects.

Question 8

Why is industrial policy gaining importance globally?

Answer 8

To stay competitive, respond to US and China, and support critical industries like semiconductors.

Question 9

Which country leads semiconductor investments in Europe?

Answer 9

Germany, with 65% of the total investments.

Question 10

What are the main drivers for semiconductor investments in Europe?

Answer 10

High automotive demand (e.g., EVs), supply chain resilience, and subsidies.