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Chip manufacturing: EU invests hundreds of millions in chip design platform

ChipsNovember 5, 20262 min read

The European Union will spend 525 million euros on a new European Chip Design Platform. The goal is to help European companies that design advanced computer chips catch up with the United States and China.

What happened

The EU announced a new platform to help European companies design computer chips. Henna Virkkunen, the EU Commissioner for digital and border technologies, made the announcement at the launch. The platform is part of the EU Chips Act, a law that aims to make Europe stronger in making chips. It will give companies tools, support services, chip building blocks, and access to factories that make chips.

Key numbers

525 million euros in total: 440 million euros in public grants from the EU and its member countries, plus 85 million euros for cloud infrastructure, support services, and open-source design tools.
European chip design companies earn less than 1 percent of the world's chip design revenue, according to the EU Commission.
Advanced start-ups can get grants of up to 16 million euros to cover the high costs of chip development.

Background

Chips are tiny parts that make phones, cars, and AI systems work. Chip design is the planning step: engineers decide how a chip works before it is built in a factory. The EU Chips Act was passed in 2023. It wants Europe to make more chips, keep supply chains safe, and depend less on the US and China. In June this year, the EU also proposed a bigger technology sovereignty package that includes a second Chips Act. In July, the EU Commission approved Germany's plans to fund four chip factory projects worth 659 million euros.

Why it matters

Europe can only build strong chip factories if companies design chips that need to be made there. Virkkunen said that a lively design industry will drive demand for factories and strengthen the whole chain in Europe. For young companies, the grants could cover costs that are often too high to pay alone.

What to watch

How many start-ups apply for the grants and which ones are chosen.
Whether European design companies grow their share of the world market.
Whether new chip factories open in Europe because of rising demand.
How the proposed Chips Act 2.0 changes the rules for chip production.

Glossary

EU Chips Act: An EU law from 2023 that aims to make Europe stronger in making and designing chips.

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