Semiconductors have become omnipresent in our daily lives. These materials, which conduct electricity and are essential components of electronic devices, from smartphones to computers, are at the very core of the accelerating digital transition. In 2022, global sales reached $574.1 billion, according to the Semiconductor Industry Association — the highest-ever annual total. But faced with ever increasing demand, the global market and production capacities are under unprecedented tension.  

Countries and companies alike are launching massive investments across the world to reinforce their technical expertise and wean themselves off their dependence on Asia’s leading semiconductor industry. For Sébastien Dauvé, director of CEA-Leti, a research institute for electronics and information technologies based in Grenoble, the last three years have shown that “we needed to regain some autonomy and sovereignty over our capacity to manufacture things on our own territory.” This has pushed Europe to recently adopt the European Chips Act (ECA), with the ambition to double the bloc’s current share of global chip production to 20% in 2030. Meanwhile, in the summer of 2022, the French government unveiled its 5-billion-euro strategy to boost the electronics sector as part of its “France 2030” plan. 

 A year later, a semiconductor mega-factory, supported by the French state with a 2.9-billion investment, has officially started production. The facility is located in Crolles in the eastern Grenoble region, where there is a “concentration of skills” and innovative actors, as Sébastien Dauvé puts it. The combination of several dynamic players in the value chain, such as Soitec and UnitySC, and public support at the national and European level, means that France is holding all the right cards. 

 Soitec, betting on innovation 

 Soitec designs and manufactures semiconductor materials — more specifically high performance substrates that will be patterned and cut into chips to make circuits for electronic components. The chips will then be used in smartphones, tablets, computers, IT servers and data centers, as well as cars, smart devices and industrial and medical equipment.  

“We are positioned across three megatrends: the acceleration of 5G, electric and autonomous vehicles, and connected devices enhanced with artificial intelligence (AI),” explains Pierre Barnabé, CEO of Soitec. Founded in 1992 in Grenoble, the company has since expanded internationally, with manufacturing facilities, R&D centers and sales offices in Europe, the United States and Asia, and boasts annual sales of 1.1 billion euros in the last fiscal year. Soitec has developed its own manufacturing process: Smart Cut™, which enables the production of high-performance, more compact electronic devices, as well as the SmartSiC™ silicon carbide technology. The latter consists in new substrates that are designed to improve the performances of power electronics devices and boost electric vehicles’ energy efficiency. The company hopes this tech can become the standard in electric vehicles by 2035.  

 “Innovation is at the heart of our business principles: 11% of our revenue is devoted to research and development and we have registered more than 4,000 patents,” says the company’s CEO. Soitec is planning a one-billion-euro investment by March 2026, with nearly half dedicated to the expansion of its production facilities in Bernin, eastern France. 

UnitySC, helping to improve the manufacturing process 

 On another side of the value chain, UnitySC has positioned itself as one of Europe’s leaders in metrology and inspection in the industry. The company, formed in 2016 from the merger of three European firms (Fogale, Altatech and HSEB), is designing tools that help look for defects that can cause a microchip to fail but also measure all variables during the production flow. “There are over 600 steps in the manufacturing of chips and any can ‘go wrong’ in some way. Our goal is to make these processes better,” sums up Graham Lynch, CMO of UnitySC. Headquartered in Grenoble, the firm has offices in the major semiconductor manufacturing hubs from the U.S. to Taiwan, South Korea, China, Singapore and Malaysia, but conducts all its development in France.

UnitySC designs its tools in cooperation with its customers, who encounter very specific issues. “Manufacturers build hundreds of chips in parallel on top of a wafer. We can think of these chips as a ‘crop’ that can be harvested if all goes well in the manufacturing processes. The chips may take two to three months to ‘grow’, meaning it’s critical to detect any potential problem as soon as possible so that our clients’ ‘crop yields’ are as high as possible,” explains Graham Lynch. For instance, the company has developed high-end technology to monitor the complex Through-Silicon-Vias (TSVs) structures, which are used to connect chips together. “We are able to find yield issues that are a tiny fraction of the width of a human hair, invisible to the human eye,” adds the company’s CMO. In 2022, UnitySC raised 48 million euros to help accelerate the production of its tools and invest in R&D.  

 A dynamic ecosystem 

 Both Soitec and UnitySC have their roots in the Grenoble region, where a dynamic electronics ecosystem has grown over the years, since the research institute of the CEA-Leti was founded in 1967. “The CEA-Leti has created more than 75 startups and built the foundations of the microelectronics sector in France. Today, we still accompany industrial actors,” says Sébastian Dauvé, director of the institute, adding that there is “a real alchemy between industry, research and training” in the area. 

 Critical support at the national and European level 

 “Support for the industry is essential if France is to remain competitive in a global market facing strong pressure from the United States and Asian countries,” warns Pierre Barnabé. For the CEO of Soitec, France’s 2030 plan is decisive to finance a number of projects, including the company’s expansion of its Bernin facilities to produce its SmartSiC™ technology. On a higher level, the European Chips Act “will support the first industrialization on European soil of a range of innovative technologies,” says Pierre Barnabé. 

 Graham Lynch, notes that France has always been “ahead of the curve” by treating the electronics supply chain as a deeply strategic part of its economy and by nurturing world-leading champions such as STM Electronics and Soitec. “Some of the biggest manufacturers of EVs are using components from these French companies. As we move away from fossil fuels towards greener vehicles, the country is in a strong position to be at the forefront of this field,” says the CMO of UnitySC. The experts agree that the future looks bright for France, and Europe as a whole.