Market Insights for April 1 - Flipbook - Page 4
European Investments in Semiconductor Manufacturing
EU Chips Act: The European Union aims to double its global semiconductor market share to 20% by 2030
through the €43 billion Chips Act. However, the European Court of Auditors has criticised the strategy as
“deeply disconnected from reality,” citing fragmented investments, lack of coordination among member states,
and insufficient funding compared to global competitors.
Private Sector Initiatives: Despite challenges, private investments are bolstering Europe’s semiconductor
landscape. Notably, Quintauris, a joint venture by companies like Bosch, Infineon, and Qualcomm, is advancing
RISC-V based technologies to reduce reliance on non-European architectures. Additionally, UK-based
Pragmatic Semiconductor has secured significant funding to expand its flexible microchip manufacturing
capabilities.
Market Outlook & Emerging Challenges
Growth Projections: The global semiconductor market is projected to grow by approximately 15% in
2025, driven by surging demand in AI, high-performance computing, and automotive sectors. The power
semiconductor segment, in particular, is witnessing significant growth due to the rise of electric vehicles and
renewable energy solutions.
Talent Shortage: A critical challenge facing the industry is the shortage of skilled labour. Deloitte estimates
that the industry needs to add over 100,000 skilled workers annually to meet demand. This talent gap is
exacerbated by an aging workforce and the rapid pace of technological advancement.
Regional Dynamics & Competitive Pressures
South Korea’s Strategic Investments: South Korea is investing approximately $470 billion over the next two
decades to establish the world’s largest semiconductor cluster. The country aims to increase self-sufficiency in
essential materials and has already seen companies like SK Hynix surpass competitors in DRAM chip market
share, fuelled by strong demand for AI applications.
Intel’s Restructuring Amid Challenges: Intel is undergoing significant restructuring, including job cuts and
reduced capital expenditures, in response to competitive pressures and trade uncertainties. The company
reported a net loss in Q1 2025 and anticipates lower revenues in Q2, partly due to the impact of Chinese tariffs
on its products.
In summary, the semiconductor industry in April 2025 is navigating a complex environment marked by
geopolitical tensions, ambitious regional initiatives, and evolving market demands. Companies are adapting
through strategic investments, supply chain diversification, and innovation to maintain competitiveness in this
dynamic landscape.
Market updates
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