Two major companies, one American and the other Franco-Italian have announced the creation of a semiconductor factory in southeast France. This came as French carmaker Renault said Tuesday that car sales fell in the first half of this year, impacted by the worldwide shortage of semiconductors.
At the "Choose France" investment summit in Versailles during the week, Franco-Italian STMicroelectronics and American GlobalFoundries said they would be building a factory in Crolles, near Grenoble (Isère).
The investment of €5.7 million will create over 1,000 jobs.
The factory will be on an existing site that belongs to STMicroelectronics, France's biggest production site.
The objective is to double current production levels and manufacture chips of different sizes, up to 18 nanometres.
Semiconductors are found in most everyday appliances and accessories such as cars, aircraft, washing machines, solar panels and video game consoles.
"This project will massively reinforce France's capacity to produce for technology and contribute to both France and Europe's resilience in terms of industry supplies and components," the Elysee Palace wrote in a statement.
Industrial sovereignty
France's economy minister Bruno Le Maire called it "the biggest industrial investment in the past decades, besides nuclear, and a step forward for industrial sovereignty".
He was due to visit the site with President Emmanuel Macron on Tuesday.
Since the beginning of the Covid-19 pandemic, the demand has skyrocketed, provoking shortages worldwide and revealing France and Europe's dependence on production from Asia.
Europe wants to increase its share of worldwide semiconductor production to 20 percent compared to 10 percent today.
The new factory will be part of the Chips Act, a programme designed by the European Union to match Asia and the United States as world leaders in semiconductor production.
Among the other investment projects announced at Choose France, the Vietnamese carmaker Vinfast is set to open 25 workshops and a showrooms across France, creating some 400 jobs by 2023.
Sales down for Renault cars
Meanwhile, French carmaker Renault said Tuesday that sales of its conventional and electrical vehicles fell in the first half of this year, impacted by the worldwide shortage of semiconductors.
It said it sold 1,000,199 units in the first half of 2022, down 12 percent compared to the same period last year. The data for both years did not include sales in Russia.
Renault said the dip in sales comes "in a context disrupted by the semiconductor crisis and marked by the shutdown of the group's activities in Russia" due to the Ukraine crisis.
Semiconductors are electronic components that are indispensable in both conventional petrol-powered and electrical vehicles.
The global shortage of such parts has forced carmakers around the world to throttle and even halt production temporarily.
Renault said its own brand continued to post strong growth in the electrified market.
"Electrified markets are booming in Europe and Renault is well placed to meet this new customer demand with suitable products," said Fabrice Cambolive, deputy chief of the Renault brand.
"In the second half of the year, we will accelerate the electrification of our range with the launches of the all-New Megane E-Tech electric, Kangoo E-Tech electric and New Austral," Cambolive said.
The E-Tech range -- electric vehicles and hybrid powertrains -- accounted for 36 percent of passenger car sales in Europe in the first half of 2022, compared with 26 percent in 2021, Renault said.
(with wires)
