Defence and aerospace industry considerations on the European Chips Act

  • May 11, 2022

 

12 April 2022

ASD welcomes the proposed European Chips Act, which has the potential to strengthen Europe’s position in the global semiconductor value chain and its security of supply. This can enhance the EU’s resilience, strategic autonomy, technological sovereignty, and industrial competitiveness. To achieve its objectives, the European Chips Act must ensure efficiency in resource allocation, coherence among all relevant initiatives, and close involvement of industry in its governance. A truly strategic approach to chips must support especially the strategically important defence, aeronautics, and space industries, with specific measures across all pillars of the initiative.

 

The European Chips Act has the potential to foster a vibrant, state-of-the-art European semiconductor ecosystem and enhance the security of supply of European downstream industries, including in the strategically important defence and aerospace sectors. It can thus provide a model for other sectorial industrial policy initiatives that aim to pursue common European objectives and boost the EU’s resilience, strategic autonomy, technological sovereignty, and competitiveness. To achieve these objectives, and with a view to providing a robust blueprint for future initiatives, we recommend that the EU’s chips strategy ensures the following:

  • Support production and secure availability for both advanced and mature semiconductor technologies used in Europe, and better integrate the dimension of raw materials to security of supply.
  • Make best use of finite resources by prioritising specific value chain segments, particularly design and test and integration activities, and coordinating efforts with trusted partners.
  • Ensure coherence between all relevant policy and funding instruments, taking care that other programmes contributing to the EU’s strategic objectives are not under-resourced.
  • Closely involve industry stakeholders from the semiconductors and downstream critical sectors in the governance of the initiative.
  • Prioritise, across all pillars, support for critical sectors and particularly the strategically important defence, aeronautics and space ecosystem. Relevant measures should include:
    • Pillar I: incentivise new chip designs that meet defence and aerospace needs, including by providing for priority-rate access to pilot lines and supporting joint civ-mil standards;
    • Pillar II: when assessing ‘first-of-a-kind' facilities and state aid, consider a facility’s commitment to support the defence and aerospace sectors, including through priority-rate access and reserving production capacity for chips that cover these sectors’ needs; consider establishing a strategic reserve of chips for these sectors;
    • Pillar III: take into consideration the specificities of the defence and aerospace industries when mapping and monitoring supply chains and prioritise defence and aerospace contracts and orders throughout the supply chain during crises.



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