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In the latest installment of Five Questions With…, Alison James, senior director for European Government Relations, discusses how geopolitics, defense demand, data center growth, and EU policy initiatives are reshaping Europe’s electronics industry and creating new opportunities to strengthen regional manufacturing across the value chain.
What is the most important shift happening in the European electronics industry right now, and why does it matter?
From a government relations perspective, the most significant shift comes as a result of geopolitical developments. As each region seeks greater self-sufficiency in strategic areas, the significance of regional electronics manufacturing grows. In Europe we have seen this particularly in the area of defence. With the invasion of Ukraine and the imperative for the European Union to become more autonomous in defence, the electronics industry is seeing a surge in demand for this sector. It matters because, while no one would wish for an escalation of conflict, it represents an important market for regional electronics manufacturing, for our European PCB as well as our EMS industries.
What’s one policy or market trend in Europe that the electronics industry is not talking about enough?
The industry is perhaps talking about it, but it is important for the industry to be aware that data centres are a strong policy focus in the European Union. With the adoption of the proposed Cloud and AI Development Act in June, the EU plans to triple data centre capacity in the coming years. As the Global Electronics Association, we have highlighted that electronics capacities and capabilities are critical. There has been significant focus on the need to develop (and access) AI chips. IC-substrate as well as PCB assembly capabilities and capacities for these super advanced packages with high form factors also need to be developed by substrate, PCB and PCBA electronics manufacturing industries. The question will be where all the capabilities and capacities will be developed and to what extent the EU can build a greater measure of technological sovereignty in these areas.
From your perspective, what gives Europe the greatest opportunity to strengthen its position in global electronics?
As an EU Government relations professional, I of course look to the regulatory framework as an enabling framework. We have spent the last years making the case at EU level for policy initiatives which would enable Europe to strengthen its position across the value chain from silicon to system, including reinforcing our PCB, EMS, IC substrate, advanced packaging and system integration capacities and capabilities. I am very pleased that this advocacy has borne fruit to date at the EU level as we have seen the proposal for a European Chips Act 2.0 which would enable European Member States to invest in electronics manufacturing. We highly appreciate that the European Commission listened to industry and translated this into a comprehensive approach in its proposal. This is a highly significant opportunity that must now be translated into a final text and, importantly, transposed into electronics strategies, programmes and funding opportunities in the EU Member States. In addition, we advocated strongly for specific funding for capacity building for electronics manufacturers for defence. Before the summer, the European Commission also issued a Call which would indeed enable manufacturers to apply for funding to build capacity. These frameworks are critically important in helping manufacturers to build capacities and capabilities and ultimately, of course, to strengthen Europe’s position in global electronics. More opportunities, more demand signals and more programmes to strengthen the ecosystem are needed as electronics are central to all strategic industries and to our daily lives.
What advice would you give to professionals who want to make an impact in this industry?
In Europe I see many dedicated professionals making an impact in this industry on a daily basis. Engagement and visibility are key. I think Europe’s electronics professionals are exceptionally dedicated to this industry and to making an impact. That they work for critical, strategic European industries likely helps. This is an industry with a cause.
You have been directly involved in the Association’s efforts with the European Chips Act. How have Association members helped to ensure the success of these efforts, and what is next on the agenda?
Our Association members have been – and continue to be – critical to ensuring the success of our advocacy work. I can say again that we have a very dedicated industry here in Europe. They are committed to building what is needed for Europe and to delivering the high reliability, secure electronics that are needed here. Over the past years we have had a very dedicated group of companies in our European Electronics Leadership Committee who commit time and expertise, our Call to Action Coalition brings together companies across the European Union as well as National Trade Associations. We have been building and can say that members have come together to provide one voice towards the EU Institutions. We are grateful for their commitment and their trust as the EU is complex. This is always a work in progress. Legislation does not stand still and neither does the world. Our immediate challenge remains next steps for the European Chips Act to ensure it is finalized and implemented at National level in a way which translates into real programmes and funding for the industry. As the geopolitical situation continues to shift we also need to ensure that all the legislative initiatives in progress from cybersecurity rules to procurement to trade instruments come together to enable strong regional manufacturing and resilient supply chains for our critical industries. We have a strong foundation from which to continue our work.
