The CEOs of European chip makers NXP, Infineon, and STMicroelectronics warn about the fragmentation of chip production. This concern arises now all regions want to start their own chip production.
CEOs Jean-Marc Chery of STMicroelectronics, Jochen Hanebeck of Infineon, and Kurt Sievers of NXP argue that their companies are less certain about the future. This is because of the rise of more nationalistic industrial policies over the past decade, which created a major obstacle to do business with other countries and regions. The three CEOs participated in a joint panel at SEMICON Europe in Munich, Germany, which Reuters reported.
Concerns about Trump
Of particular concern is the fragmentation of chip production that this policy brings. The CEOs of European chip manufacturers are very concerned that the trend of nationalistic industrial politics will be accelerated and continue to increase fragmentation. They see more and more fragmentation in terms of the supply chain. With the re-election of Donald Trump in the U.S., there are also fears about (import) tariffs.
CEOs indicate that setting up separate supply and production chains for countries or continents is expensive for both material costs and development work.
Separate production impossible
NXP CEO Sievers additionally indicates that it is impossible for any one country or region to dominate the chip industry or operate independently of the rest of the world. Even if the possibility came about, the chips would be so expensive that no consumer could afford a device with them. He expects that governments will eventually come to realize this.
The three CEOs are making their statements for their own benefit. Both STMicroelectronics, Infineon and NXP sell their (specific) chips on the Chinese market, mainly to use in industry settings and for electric cars.
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