Happy with EU Chips Act, but industry needs ‘China clarity’

The chief executive of Dutch-headquartered computer chip maker NXP Semiconductors applauded the passage of the EU Chips Act this week, but said the industry could use more clarity on export restrictions to China.

Kurt Sievers said his company, which makes chips for the automotive industry as well for 5G telephone base stations, had been hit by successive rounds of U.S. export restrictions on China’s Huawei.

“What I think for our industry is sometimes hard to deal with is there doesn’t seem to be a clear roadmap on what to expect going forward,” he said, speaking at the Bloomberg New Economy conference.

Around 38% of NXP‘s sales are to Chinese manufacturers, about half of which are processed and then re-exported to Western buyers.

“A lot of that going forward could eventually move out of China, which doesn’t harm us,” he said. “We will just follow where our customers are moving.”

He said he hoped the U.S. and Europe would cooperate on how they distribute subsidies.

The more than $50 billion in subsidies now on offer to chip manufacturers from the U.S. government and 43 billion euros ($47 billion) in Europe is “big money” from a government perspective but not much from a corporate perspective, he said, given the immense capital costs involved in building semiconductor manufacturing plants.

“I think it would be fantastic if there was a lot of synchronization between the U.S. Chips Act and the European Chips Act in terms of what to support such that it will be complementary,” he said.

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The chief executive of Dutch-headquartered computer chip maker NXP Semiconductors applauded the passage of the EU Chips Act this week, but said the industry could use more clarity on export restrictions to China.

Kurt Sievers said his company, which makes chips for the automotive industry as well for 5G telephone base stations, had been hit by successive rounds of U.S. export restrictions on China’s Huawei.

“What I think for our industry is sometimes hard to deal with is there doesn’t seem to be a clear roadmap on what to expect going forward,” he said, speaking at the Bloomberg New Economy conference.

Around 38% of NXP‘s sales are to Chinese manufacturers, about half of which are processed and then re-exported to Western buyers.

“A lot of that going forward could eventually move out of China, which doesn’t harm us,” he said. “We will just follow where our customers are moving.”

He said he hoped the U.S. and Europe would cooperate on how they distribute subsidies.

The more than $50 billion in subsidies now on offer to chip manufacturers from the U.S. government and 43 billion euros ($47 billion) in Europe is “big money” from a government perspective but not much from a corporate perspective, he said, given the immense capital costs involved in building semiconductor manufacturing plants.

“I think it would be fantastic if there was a lot of synchronization between the U.S. Chips Act and the European Chips Act in terms of what to support such that it will be complementary,” he said.

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