European Commission wants to create an 'Airbus for chips'

Airbus, created from defense and aerospace companies across Europe, could be a model for the microelectronics sector

Europe's top digital commissioner has called for an "Airbus for chips" to boost the bloc's microelectronics sector.

Digital Agenda Commissioner Neelie Kroes said on Tuesday that if the European Union wants to be a global player in chip production, then collaboration and cooperation is the only way forward. "Why not a digital Airbus, or an Airbus for the chip sector?" she asked. "That scale of success is what you can get if you put borders aside and work in partnership."

Airbus, a subsidiary of European Aeronautic Defence and Space Company, was created from national defense and aerospace companies across Europe to compete with Boeing on a commercial level. Airbus now produces half the world's jet airliners.

The Commission plans to launch an electronics industrial strategy with the aim of increasing Europe's attractiveness for investment in design and production. "It doesn't mean we would structure a venture in the exact same way as Airbus, but the point is that Airbus didn't materialize by magic, it was planned and it took national and E.U. coordination, and we see value in achieving something similar with chips," said Digital Agenda spokesman Ryan Heath.

But the plans may be too little too late as figures from the World Semiconductor Trade Statistics show that the European manufacture of chips has been in decline for a number of years.

In April, European chip sales recorded a yearly drop of more than 14 percent, said the European Semiconductor Industry Association (ESIA). There was a tiny improvement in the most recent figures -- European sales of semiconductors in October were 0.2 percent higher than in September at US$2.79 billion.

Nonetheless, according to IC Insight, a market research company, STMicroelectronics is the only European company in the top 10 global players in an industry dominated by U.S. giant Intel.

A patchy pan-European policy framework may be partly to blame, which is why Kroes is urging the European industry to unite in order to face the global challenge of producing chips in a competitive manner.

"Complacency is a killer," she said. "The digital economy is growing seven times faster than the rest of the economy, but we need to take risks. There is too much risk-avoiding in Brussels."

Follow Jennifer on Twitter at @BrusselsGeek or email tips and comments to jennifer_baker@idg.com.

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