In the global environment for semiconductor businesses, uncertainty prevails, and the geopolitical scene is becoming more fractured. This outlook underlay the discussions at the SEMI Industry Strategy Symposium Europe (ISS Europe) 2024 hosted in Vienna (March 7-8, 2024). Factors such as rising competition with China and the potential security threats to Taiwan, alongside increasingly strained supply chains constrained by rising trade barriers have all played their part in the European Union’s (EU) decision to implement its Chips Act.
The Act is a regional response to an evolving global landscape: the expert contributions at the symposium highlighted just how global and interconnected the industry is. As such, the problems and opportunities facing the industry are best confronted together, in a spirit of collaboration.
This was the clarion call from the very start of ISS Europe 2024, an event which attracted a record attendance. As Laith Altimime, SEMI Europe President, said “Europe needs the Chips Act to be a big success. It is important not only for Europe but for the world, because the world needs a thriving and diversified semiconductor industry.” His view was supported by SEMI President and CEO Ajit Manocha, who said “SEMI’s top priorities all have a global footprint, from sustainability and climate to talent development and supply chain management.”
He highlighted the unique role that SEMI plays in advocating for the industry globally, citing the 2023 SEMI Industry Policy Summit on PFAS chemicals in Hawaii. “SEMI brought more than 50 industry executives in front of government policymakers from all around the world, giving them a chance to explain why an immediate ban on PFAS would be the wrong decision,” he explained.
Laith Altimime, President of SEMI Europe
Ajit Manocha, President and CEO of SEMI
One company playing a substantial role in the rebalancing of the global industry is Intel. David Bloss, its Corporate VP in Manufacturing Supply Chain and Operations, paid tribute to Europe’s contribution to Intel’s five nodes in four years mission, stating “Europe is a critical part of Intel’s supply chain. In research, lithography, wafer metrology, advanced packaging, and components and testing, Europe is a world-class location, and that’s why we have invested so heavily in Ireland, Israel and Poland.”
David Bloss, Corporate VP in Manufacturing Supply Chain and Operations of Intel
A new spring in Europe’s step
According to Intel Ireland’s Director of Government Affairs Leonard Hobbs, the EU Chips Act injected “a new sense of belief and ambition in Europe’s industry.”
There is plenty of cause for optimism. Handel Jones, Founder and CEO of International Business Strategies, spoke of the next “generative AI generation.” Estimates are that chips for generative AI applications could make up some $200 billion of semiconductor sales by 2027. So how can Europe profit from the enormous growth in the industry? Jean-Christophe Eloy, President and CEO of Yole Group, urged a focus on Europe’s strengths in semiconductor equipment and subsystems: “Yole Group’s forecast is that the equipment market will be worth more than $120 billion in 2028, up from $40 billion in 2016 – a huge rate of growth.” According to Eloy, despite the EU Chips Act’s focus on leading-edge semiconductor manufacturing, Europe should work to maintain and grow its leadership positions in specialty chip manufacturing, WFE, subsystems, and the support ecosystem for chip manufacturing.
Leonard Hobbs, Director Government Affairs of Intel Ireland
Handel Jones, Founder and CEO of International Business Strategies (IBS)
Jean-Christophe Eloy, President and CEO of Yole Group
In planning for growth, Europe’s industry can learn from the success of regions which are already thriving. Andreas Lippert, VP of Acquisition and Inward Investment at Saxony Economic Development Corporation, described how Europe’s biggest semiconductor hub is based in the city of Dresden. He said its strengths included “a very densely clustered ecosystem, an excellent schooling system, local universities with expertise in STEM subjects, and access to a big common European market."
Andreas Lippert, VP of Acquisition and Inward Investment at Saxony Economic Development Corporation
The region of Pomerania (northern Poland) has ambitions to follow the lead of Silicon Saxony. Invest in Pomerania’s Deputy Director, Mikolaj Trunin, explained that Poland is primed for growth in technology markets because of its abundance of talent. He said “Poland ranks in the top three countries in the world for programming talent and has the fourth largest cohort of STEM graduates in Europe” – a factor behind Intel’s decision to locate its latest packaging plant in Poland.
Mikolaj Trunin, Deputy Director of Invest in Pomerania and Agnieszka Szweda Key Expert of Investment Center of the Polish Investment and Trade Agency
Dr Isabel Obieta, Programme Manager for Sustainable Semiconductors at the European Innovation Council and SMEs Executive Agency (EISMEA), encouraged entrepreneurs who want to set up in one of Europe’s semiconductor clusters to take advantage not only of the funding available from EISMEA, but also the agency’s ability to connect start-ups with potential customers.
Isabel Obieta, Programme Manager for Sustainable Semiconductors at the European Innovation Council and SMEs Executive Agency (EISMEA)
Weathering the storm
The opportunity in front of Europe is exciting, but the industry is not sailing in calm waters, as Silke Sorger, VP of Procurement at Infineon, described in a session on the supply chain. The semiconductor industry is scarred by the crisis of the Covid pandemic. Sorger highlighted three priorities for action: “We need more data on inventory management and to support forecasting. We need to establish multi-sourcing arrangements, to diversify across suppliers and regions, and we need to balance traditional annual purchase orders with longer-term procurement agreements.”
Silke Sorger, VP of Procurement at Infineon
Sandrine Bronner, VP of the Supply Chain at Edwards Vacuum, echoed Sorger’s call for data and digitalization. She displayed Edwards’ supplier matrix, a nine-parameter framework for assessing suppliers. She said it was part of Edwards’ effort to “compare suppliers in a more rigorous way with fact-based criteria.”
Sandrine Bronner, VP of the Supply Chain at Edwards Vacuum
And Jens Irmscher, VP of Semiconductor Purchasing at BMW, confirmed the demand from the industry’s customers for a secure and predictable supply chain. He said “Since the supply crisis, changes that we have instituted include demanding a dual-fab approach for key components such as microcontrollers. And we are pleased that TSMC is building a fab in Dresden, because it diversifies our semiconductor supply chain away from Taiwan.”
Left to right: Moderator, Nitin Dahad, Journalist at EE Times; Panelists: Stefan Kester, Director Global Sales & Customer Relations, Schenker AG; Mikolaj Trunin, Deputy Director, Invest in Pomerania; and Jens Irmscher, Vice President Purchasing, QMP Sensors, Control Units Automated Driving, Semiconductors, BMW
Talent in short supply
A shortage of qualified, capable staff is another headwind for the industry – one that SEMI is helping to address globally. The panel discussion Achieving EU Ambitions through Successful Recruitment and Retention pointed out that over half of the population in Europe is female; however, women are significantly underrepresented in the industry. This is a considerable missed opportunity to fill the talent pipeline. Speakers urged the industry to support school and university STEM programs that aim to increase the number of girls qualifying in STEM subjects. Girls should be engaged early in STEM, between the age of five and nine. Data shows that after the age of nine, girls’ interest in STEM tends to drop off.
Left to right: Cassandra Melvin, Senior Director of Business Development and Operations at SEMI Europe; Catherine Le Lan, University Program Manager – EMEA Synopsys France; Bernd Deutschmann Univ.-Prof. Dipl.-Ing. Dr.techn, Graz University of Technology Institute of Electronics; Isabella Drolz, VP Product Marketing, Comet Yxlon
Sustainability in focus
The symposium turned to how the industry’s progress towards $1 trillion in sales by 2030 can be reconciled with its responsibility to the planet and the climate. As Katharina Westrich, Global Head of Vertical Management Semiconductor at Siemens, pointed out “the industry is responsible for 100M tonnes of CO2 emissions in 2021 and used 1 trillion liters of water.” She said that the industry’s growth could be reconciled with sustainability requirements with the help of digital twin approaches to fab design and operation. Citing Siemens’ internal use of digital twins, she said it had produced “a 40% reduction in space requirements, 20% higher productivity and around 30% savings in energy use.”
Katharina Westrich, Global Head of Vertical Management Semiconductor at Siemens
Meanwhile Miriam Tolksdorf, Global Head of Sustainability at Merck Electronics, told delegates that around 80% of CO2e emissions are attributable to process gases, creating a need for less harmful alternatives. Here, AI can help to accelerate the necessary scientific research. She said “There are huge databases of materials that AI can use to speed up the development cycles of new materials research, with both performance and sustainability criteria built in.”
Miriam Tolksdorf, Global Head of Sustainability at Merck Electronics
Ivo Raaijmakers, Corporate VP and Executive Advisor at ASM, agreed, saying “We need to revitalize materials science in the semiconductor world” – and he looked forward to the prospect of generative AI accelerating pathfinding in this branch of research.
Ivo Raaijmakers, Corporate VP and Executive Advisor at ASM
Jo De Boeck, EVP and CSO of imec, laid out a roadmap towards more sustainable semiconductor manufacturing. “imec.netzero, a digital platform for planning for sustainability in the fab, helps fab operators to make the right decisions. For instance, we have modelled the climate impact of the move to high-NA lithography to show that, while it entails a large rise in energy use in the scanner, the lower number of process steps means that total power consumption falls,” said De Boeck.
Jo De Boeck, EVP and CSO of imec
The summit closed with a panel discussion, chaired by Laith Altimime, on the subject of empowering excellence in Europe: expectations, challenges and opportunities. Juergen Schmidt, VP of Frontend Semiconductor Manufacturing at Robert Bosch, pointed to his company’s program for increasing resilience. “We are investing heavily to diversify the supply chain, including in production sites in Malaysia and the U.S., while also working to make our supply chain more European,” he said.
Manfred Horstmann, Managing Director and Senior VP at GlobalFoundries, told of his vivid recollection of the fragility of supply chains. “Two months after starting at GlobalFoundries in Dresden, that ship got stuck in the Suez Canal and jammed the world’s supply chains. That was great timing! I learned early that we have to understand which materials are shipped and which come by truck. Relying on regional sources can be very important for manufacturing resilience.”
The panel also considered the ways in which Europe is an epicenter of semiconductor activity. Thomas Richter, Senior VP and Managing Director at Infineon in Dresden, said “We have great closeness with our customers. We have a deep understanding of their needs. In the automotive market, we know the whole value chain, not just the car maker, but all the tiers of the supply chain.”
Horstmann also highlighted the strength of the region’s school and university systems, its advanced infrastructure, and the appeal to skilled overseas workers who want to relocate to Europe.
Left to right: Moderator, Laith Altimime, President of SEMI Europe; Panelists: Manfred Horstmann, Managing Director and Senior VP, GlobalFoundries Dresden; Thomas Richter, Senior VP and Managing Director, Infineon in Dresden; Juergen Schmidt, VP Semiconductor Manufacturing Frontend, Robert Bosch GmbH; and Andreas Lippert, Head of Department (Vice President) Acquisition, Inward Investment, Saxony Economic Development Corporation
As Laith Altimime concluded, Europe is showing how collaboration is crucial for all global industry companies. “The European Commission, member states and the industry are coming together to ensure that the European Chips Act is a big success. This more than a one-off initiative, and should give us all great cause for optimism,” said Altimime.
The symposium gala dinner took place at historic Hofburg Vienna palace where guests enjoyed an evening of exceptional entertainment, dining, and networking. The Vienna Musicality Quartet, comprised of Ukrainian musicians, performed at the gala dinner.
ISS Europe 2024 Gala Dinner at the Hofburg Vienna
During the event, SEMI Europe announced recipients of the SEMI European Award and Special Service Award for 2023. Dallal Slimani, Chief Strategy Officer at Schneider Electric, was honored with the European SEMI Award and Dr. Ivo Raaijmakers, Corporate Vice President and Executive Advisor at ASM, with the Special Service Award.
Left to right: Nicolas Leterrier, Semiconductor Sustainability Business Leader of Schneider Electric, receiving the award on behalf of Dallal Slimani, Chief Strategy Officer at Schneider Electric, and Laith Altimime, President of SEMI Europe.
Left to right: Ajit Manocha, President and CEO of SEMI, and Ivo Raaijmakers, Corporate Vice President and Executive Advisor of ASM
On behalf of SEMI, the SEMI Europe team and ISS Europe committee would like to thank speakers, sponsors, and attendees for making the event the most successful ISS Europe to date, surpassing the 2023 record. ISS Europe 2025 will take place in Sopot, Poland from March 12-14.
Cassandra Melvin is Senior Director of Business Development and Operations at SEMI Europe.