Survey: European chips likely to be only slightly more expensive
How much more would companies be willing to spend for more secure chip supply chains? The answer is clear.
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The IT association Bitkom surveyed 301 companies to see if they would be willing to pay more for semiconductors produced in Europe with identical quality. The pain threshold quickly becomes clear: no company would be willing to pay more than 10 percent above current prices. 17 percent would go up to this threshold. 74 percent see the pain threshold reached at a maximum of five percent higher price. Only five percent of companies believe it should be at most one percent, and only one percent considers higher prices in exchange for more supply chain security unacceptable.
For Bitkom, this finding is like water on the mill for the advocacy group, which has been campaigning for years to bring more semiconductor production to Europe. “It is an encouraging signal that the economy is willing to invest in more supply security and our digital sovereignty,” says Bitkom President Ralf Wintergerst. Digital sovereignty does not come for free, and building a competitive semiconductor ecosystem initially costs money.
Not the actual production is the cost factor
In fact, this is one of the key problems in chip manufacturing in Europe: while actual production is largely highly automated, the costs of mass chip production are primarily driven by energy, water, and transport expenses for precursors and further processing, as well as the high costs of pre-financing by investors. It is a kind of chicken-and-egg issue: for profitable production, purchase guarantees are necessary, which can achieve a high utilization rate over a longer period.
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Among other things, the EU, with the so-called Chips Act, enabled massive state support for the construction of production facilities. This has so far a rather mixed success and is to be revised in the coming months. Nevertheless, the surveyed companies are relatively satisfied: only 28 percent of all surveyed companies rated the related EU efforts as rather or very poor, 71 percent as very good, good, or rather good.
The figures collected by the association's own survey institute may even be somewhat more conservative than the current mood: the survey of companies already took place in late summer, long before the current Nexperia crisis.
(emw)
