European Chips Act Aims To Address Semiconductor Shortage

Image of a semiconductor chip

The global semiconductor shortage has affected motorcycle manufacturers since as early as February 2021. As a result, companies like Bosch and Intel have increased investment in microchip manufacturing. House Democrats and President Biden are also pushing for $52B of investment in semiconductor production and research to speed up the process further.

Now, the EU is making similar decisions with the proposal of the European Chips Act. RideApart mentions in its report that, if adopted, “the initiative will utilize €43 billion ($47 billion) in public and private investments to double the EU’s semiconductor market share to 20 percent by 2030. In addition to supporting the continent’s research, technology, and design resources, the bill will help establish a robust chip manufacturing and packaging sector.”

People working in a semiconductor factory

European Commissioner for Competition, Margrethe Vestager, said “Chips are necessary for the green and digital transition – and for the competitiveness of European industry.

“We should not rely on one country or one company to ensure safety of supply. We must do more together – in research, innovation, design, production facilities – to ensure that Europe will be stronger as a key actor in the global value chain.”

The European Chips Act will also assist startups in attaining a sustainable business model to establish a broader semiconductor ecosystem. The Commission’s Member States will also pool resources to track semiconductor supply, demand, and potential shortages.

The radar sensor on the Ducati Multistrada V4

Ursula von der Leyen, President of the European Commission, said, “With the European Chips Act, we are putting out the investments and the strategy.” 

“But the key to our success lies in Europe’s innovators, our world-class researchers, in the people who have made our continent prosper through the decades.”

“In order to go into effect, the European Parliament and the Council will need to approve the proposed regulation. Unfortunately, a concrete approval date hasn’t been determined, but in the meantime, the Commission will help “co-legislators to reach an agreement as soon as possible.”

We’ve seen motorcycle costs rise by over 10-15% over the last couple of years due to the shortage. With major manufacturers like BMW Motorrad, Ducati, and KTM based out of Europe, the European Chips Act could be the glimmer of hope that helps bring supply back to normal.

Source: RideApart