The decline in the European semiconductor industry could be putting 500,000 European jobs at risk, according to SEMI, the trade body for vendors of semiconductor manufacturing materials and equipment, calling on the EU and national policymakers to invest to support the European semiconductor industry.
'The equipment / materials producers and the semiconductor device manufacturers together today contribute some €29bn directly to the EU economy and provide around 215,000 direct jobs, which rises to halve a million jobs when indirect jobs are counted', reports SEMI.
The European share of the global semiconductor market has declined, from 21 per cent in 2001 to 16 per cent in 2007, says SEMI, and European semiconductor manufacturing contracted by almost 25 per cent between 2005 and 2007.
"If semiconductor manufacturers leave Europe, indigenous equipment & materials producers will face an uncertain future", said Franz Richter, European Chairman of SEMI, "the current economic crisis and rising unemployment underscore the urgent need to safeguard jobs in the European semiconductor industry."
'The European semiconductor industry value chain provides a significant contribution to the GDP of 11 EU countries, and provides European companies in key industries, such as energy, transportation, telecommunication, defence, aerospace, medical equipment and biotechnology, with the pioneering products that help these European companies remain innovative and competitive in globalised markets,' says SEMI.
SEMI's problem is that the European semiconductor industry is in very bad shape. Qimonda, the DRAM company in which Infineon has an 80 per cent stake, is almost bankrupt, while Infineon faces a requirement to repay euros 1bn worth of bonds next year or face a re-financing of the debt which could see it taken over, or broken up, or both.
NXP is owned by a consortium led by Wall Street private equity company KKR, and is bleeding cash. ST, the strongest of the Big Three, is seeing its share price down around euros 5.
Having backed the microelectronics industry ever since the Philips-Siemens Megaproject of 1983, the EU may feel disenchanted that one of the Big Three is already in US hands, while another could be by the end of next year.
See also: Mannerisms, the blog of David Manners. Updated twice daily, it's the distinctive, entertaining, authoritative and never dull commentary on the semiconductor industry, from someone who knows. Sign up for the Mannerisms eNewsletter.