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Photonics companies call on EU to invest in supply chain


CEOs from eight of Europe’s integrated photonics companies have presented the EU Commission with a €4.25 billion plan to build a resilient European supply chain for photonic integrated circuits. They presented the plan to Thomas Skordas, deputy director-general of the Directorate‑General for Communications Networks, Content and Technology (DG Connect), and Lucilla Sioli, director for artificial intelligence and digital industry, DG Connect, and Werner Steinhögl, head of sector, Unit for Microelectronics & Photonics for the European Commission.

The plan calls for €4.25 billion in funding over eight years and a range of recommendations to enable the European integrated photonics industry to become a global leader and to build the capacity to supply EU customers autonomously. Photonic integrated circuits (PICs) open the door to the creation of smaller, faster and more energy-efficient devices. They are already being used in a range of innovations including telecom and datacom, autonomous vehicles, quantum communication, and agriculture.

The group states that the low level of EU manufacturing capacity and overreliance on Asia threatens the EU’s economic security and resilience. Currently, less than 6 percent of the manufacturing of indium phosphide and silicon nitride PICs is done in the EU and less than 4 percent of global assembly, testing and packaging capacity resides in Europe. Furthermore, according to research by Dutch photonics ecosystem PhotonDelta, competitor nations are making concerted efforts to acquire EU PIC technologies and assets along with seeking stakes in EU SMEs in the EU PIC supply chain.

The CEOs of XFAB (Germany/France), SMART Photonics (the Netherlands), Aixtron (Germany), PHIX Photonics Assembly (the Netherlands), VLC Photonics (Spain), Almae (France), Ligentec (Switzerland/France) and PhotonDelta (the Netherlands), unveiled the plan at PIC Summit Europe in front of more than 500 members of the global photonics and semiconductor communities.

The proposal makes several recommendations, including: to provide over €2 billion in incentives for industrial-scale InP and SiN PIC manufacturing capacity in Europe; to provide EU PIC SMEs access to industrial PIC test and experimentation facilities with the latest equipment and tools; and to establish an industrial PIC ‘manufacturing supply chain’ resilience fund of €200 million to support the investments needed to strengthen linkages and minimise vulnerabilities.

Johan Feenstra, CEO of SMART Photonics, said: "Over the past few years we have been repeatedly reminded that the world is becoming a more volatile and unpredictable place. Global supply chains have been shown to be fragile, and overreliance on one country for critical components is an economic and security risk. This is particularly true of the semiconductor industry."

"Photonic integrated circuits have the capacity to transform a huge range of industries. It is also fundamental to the advancement of some of the most exciting new technologies. Currently, the EU has a vibrant and growing integrated photonics industry, however, without volume manufacturing, testing and packaging capacity we are incredibly vulnerable to global events and the policies of competitor countries."

"Our proposal outlines a number of practical steps that the EU can take over the next decade to ensure the continued growth and security of the integrated photonics industry. For just over €4 billion we can build our supply chain and ensure the future of an industry which has the capacity to generate hundreds of billions of euros each year for decades to come."

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