23008_Nearshoring Report

In March 2022, global chip manufacturer Intel announced plans to invest up to EUR 80 billion in the EU over the next decade along the entire semiconductor value chain – from research and development to manufacturing to packaging technologies – with the aim to create a “next-generation European chip ecosystem” and “address the need for a more balanced and resilient supply chain”. This includes EUR 17 billion for a leading-edge semiconductor ‘fab’ mega-facility near Magdeburg, west of Berlin in Germany, expected to come online in 2027; the German government have reportedly already committed to EUR 6.8 billion in subsidies to the project. In addition, Intel have signalled their intention to create a new R&D and design hub in France, and to invest in R&D, manufacturing and foundry services in Ireland, Italy, Poland and Spain. INTEL production of semiconductors from 10% of global volumes to 20% by 2030. It aims to do this through a series of government incentives and support programmes designed to strengthen Europe’s research and technological development towards faster and smaller chips, build and reinforce capacity for the design and manufacture of chips within the EU and address the skills shortage in the sector by attracting new talent and supporting this skilled workforce. It will do this through EU programmes in R&D as well as support from Member States which will result in more than EUR 43 billion of policy-driven investment which the EU envisages will be broadly matched by long-term private investment. Similar to the US CHIPS act, the European Union Chips Act is an industrial policy designed to encourage and support the development of the European semiconductor industry and increase the EU’s

In the instance of semiconductors, European countries are under pressure to respond to changing environments in other countries. In August 2022, the US Government signed into law the Creating Helpful Incentives to Produce Semiconductors and Science Act (CHIPS Act) which is designed to boost US competitiveness, innovation and national security, particularly as relates to the design, production and supply of semiconductors. It also means USD 280 billion of incentives to encourage businesses to invest in the US. Additionally, the US has sought to significantly restrict China’s access to semiconductor technology generated in the US: in October 2022, the US Department of Commerce released new rules prohibiting the export to China of both high-end chips themselves and the technology to manufacture them. Not only do the new rules ban US companies from exports the technology to China but they also apply to any company globally that uses US semiconductor technology — which is likely to cover most if not all the world’s leading chipmakers. This highly-restrictive policy seeks to limit China’s ability to develop new and emerging semiconductor technologies in which the US is seeking to position itself as world leader.

In May 2022, technology company Astrata announced that it had agreed a deal with electronics manufacturer Bosch to manufacture its advanced fleet management system for heavy goods vehicles and light commercial vehicle hardware. Astrata said that moving production from Malaysia to Bosch’s facility in Normandy, France will improve its European delivery performance and reduce its impact on the environment and reduce its logistical risks, particularly following challenges sourcing components on a global scale as faced during 2021. ASTRATA



C U S H M A N & WA K E F I E L D

I N D U S T R I A L E VO L U T I O N | N E A R S H O R I N G

Made with FlippingBook Digital Proposal Maker