Europe’s Chips Act 2.0 must start with demand - Teknologiateollisuus ry

The EU Chips Act 2.0 debate is fundamentally a sequencing question: build the road first, or the car first? Teknologiateollisuus ry's demand-first position exposes Brussels' structural weakness—fab investment without anchored customers is just another Intel Ohio: depreciation schedules outpace P&L recovery. Demand-side primacy locks European fabs into 28nm–90nm automotive and industrial nodes rather than chasing 2nm. This reshapes the upstream EDA toolchain (functional-safety IP re-certification) and downstream packaging (compressed AEC-Q100 qualification cycles). Compliance costs shift from generic to scenario-specific, but risk persists: if European specs misalign with Taiwan, China and South Korean production capabilities, a new supply-disruption window opens. Strategic positioning: Washington subsidizes supply, Beijing enforces domestic substitution. A demand-first EU carves a third path—market-definition power over capacity subsidies. TSMC and Samsung will recalibrate European expansion timelines; Intel may pivot its EU fabs toward automotive/industrial-dedicated production. 12–24 month outlook: Bosch, Continental, and NXP will consolidate internal chip requirement specs, creating a de facto "European chip standard." The true long-tail effect: sufficient demand-side leverage gives Europe veto power over which advanced nodes it deploys and at what volume—far more strategically valuable than ten new fabs.