Europe Integrated Circuits Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

Europe Integrated Circuits Market Trends and Insights

EU Chips Act – capacity expansion incentives

Public subsidies unlocked by the Act reshaped Europe’s cost structure for fabs, allowing Infineon to green-light a USD 5 billion Smart Power Fab in Dresden after securing EUR 1 billion (USD 1.18 billion) in state aid. The legislation’s three-pillar design integrates research networks with pilot-line funding, enabling start-ups and institutes to move prototypes into volume faster. An EU-level monitoring system now tracks inventory across the value chain, offering early warning on disruptions that plagued the region in 2021–2022. Together, these levers narrow cost differentials with Asian peers and support Europe's integrated circuits market expansion by balancing strategic autonomy with open trade.

Automotive electrification surge led by German OEMs

Electric vehicles require 3–5 times more semiconductors than combustion cars; Volkswagen, therefore, signed a multi-year power-device pact with onsemi, which is scaling end-to-end silicon-carbide output in the Czech Republic to serve European plants. Infineon’s AURIX and TRAVEO microcontroller lines pushed their global automotive MCU share to 29% in 2024, underscoring how embedded processing and high-voltage control dominate design wins. Zone-control architectures and over-the-air update features intensify the need for secure, high-bandwidth interfaces, driving broad-based demand across analog, logic, and memory categories within the European integrated circuits market.

Edge-AI and IIoT deployment across European factories

Industrial firms in Germany and the Netherlands installed AI-enabled vibration and temperature monitors that predict machine failure, relying on ultra-low-power mixed-signal chipsets such as Analog Devices’ Voyager4 sensor platform. The EU-funded PREVAIL consortium allocated EUR 156 million (USD 183.63 million) to accelerate on-device intelligence, pairing CEA-Leti and Fraunhofer with fabless start-ups to co-develop neuromorphic cores. Rising factory digitalization fuels persistent double-digit unit growth for industrial MCUs, connectivity ICs, and high-end memory, expanding the European integrated circuits market across mid-sized manufacturing economies.

Renewable-energy power electronics demand in Nordics

Massive offshore wind complexes like Ørsted’s 2.4 GW Hornsea 4 need fast-switching power modules to stabilize variable output. Hitachi Energy shipped Europe’s first enhanced STATCOM system using wide-band-gap semiconductors to the project, spotlighting gallium nitride and silicon-carbide devices as grid enablers. Meanwhile, Nordic data centers built with 100% renewable supply, such as Microsoft’s USD 3.2 billion Swedish campus, require high-efficiency power chains, reinforcing demand for advanced ICs.

Limited <10 nm foundry capacity within Europe

TSMC’s Dresden joint venture will focus on 28 nm and above nodes, leaving European handset and high-performance computing designers dependent on Asian fabs for advanced logic.^{[2]Taiwan Semiconductor Manufacturing Company Limited, “ESMC Breaks Ground on Dresden Fab,” pr.tsmc.com} Sub-10 nm facilities demand USD 20 billion-plus outlays and top-tier EUV ecosystems that only a handful of companies can deploy. IMEC’s High-NA EUV pilot line will not reach commercial scale before 2028, prolonging the technology gap. The shortfall constrains Europe's integrated circuits market participation in AI accelerators, 5G radio silicon, and flagship mobile processors.

Semiconductor-skilled labour shortage and aging workforce

The United Kingdom reported that 39% of its semiconductor employees could retire within 15 years, while universities graduate insufficient process-engineering talent to compensate. SEMI projects a need for 1 million additional workers across Europe by 2030, a gap that threatens to cap fab utilisation and delay ramp-ups. Apprenticeships and cross-border mobility programs are in place, yet the lead time to cultivate niche expertise spans five to seven years, dampening the Europe integrated circuits market’s growth trajectory.

Segment Analysis

By IC Type: Memory Gains Momentum

Analog components held a commanding 32.4% revenue share in 2024, reflecting their ubiquity across power management and sensing circuits in vehicles and industrial automation. Memory devices, however, are scaling fastest at a 9.5% CAGR as edge-AI workloads and in-vehicle infotainment demand high-bandwidth, low-latency storage. This shift points toward heterogeneous architectures where processing-in-memory and neuromorphic arrays compress data-movement overhead. The European integrated circuits market size for memory chips dedicated to automotive advanced driver-assistance systems is projected to grow by double digits annually through 2030, fueled by infotainment upgrades and sensor fusion modules. Logic devices remain pivotal for functional safety, underpinning automotive microcontrollers and industrial PLCs. Infineon’s AURIX family illustrates Europe’s edge, pairing real-time control cores with cybersecurity blocks that comply with ISO 26262 functional-safety standards.

The memory surge dovetails with Europe’s strategic tilt toward decentralized computing: factory robots, smart-grid nodes, and autonomous shuttles all require on-board inference engines. Novel non-volatile memories that combine endurance with low energy draw are under joint development by CEA-Leti and STMicroelectronics, aligning with EU calls for sovereign edge-AI hardware. As such, the European integrated circuits market continues to rebalance toward data-centric architectures without eroding analog’s bedrock role.

By Technology Node: Legacy Dominates, Leading Edge Accelerates

Nodes above 90 nm commanded 45.5% of 2024 revenue, underscoring Europe’s alignment with “more-than-Moore” sectors like powertrain control and smart-grid metering, where high voltage tolerance and robust qualification outweigh sheer transistor density. Sub-10 nm chips attracted the steepest 16.1% CAGR outlook—yet from a modest base—driven by AI accelerators and premium handset SoCs. The 28–90 nm bracket delivers the cost-performance sweet spot for automotive radar processors and industrial controllers, sustaining high-volume output at legacy fabs. Europe's integrated circuits market size growth within the 10–28 nm tier will hinge on new Dresden capacity, which targets 28 nm FinFET lines optimised for automotive safety integrity.

imec’s monolithic CFET proof-of-concept, featuring stacked complementary transistors, signals Europe’s capacity to influence next-decade scaling paradigms. Nonetheless, commercial translation depends on further capital infusion and ecosystem alignment around high-NA EUV lithography.

By Wafer Size: 300 mm Standard, 450 mm on Horizon

300 mm lines generated 50.6% of 2024 revenue, positioning them as the economic backbone for Europe's integrated circuits market fabrication. Companies are eyeing ≥450 mm wafers, projected to swell at 15.3% CAGR, as a lever for lower die cost in power and mixed-signal applications. Infineon’s first 200 mm silicon-carbide product release represents an intermediate milestone towards larger-diameter wide-band-gap production. Smaller formats, especially 150 mm gallium-nitride lines in the United Kingdom, will persist for niche high-mix, low-volume runs that underpin quick-turn aerospace programs.

Adopting 450 mm substrates requires concurrent investments in lithography and metrology tools; ASML’s leadership in the Netherlands positions Europe favorably once demand justifies the transition. Cost gains from bigger wafers will flow into competitive pricing for automotive inverters and server power supplies, reinforcing the Europe integrated circuits market’s scale advantages.

By End-user Industry: Automotive Accelerates

Consumer electronics retained the largest 40.5% piece of 2024 revenue, covering smartphones, wearables, and smart-home nodes distributed across Western Europe. Yet automotive semiconductors are sprinting ahead with a 13.6% CAGR as EV penetration climbs toward the EU’s 2035 zero-emission mandate. Software-defined architectures featuring centralized domain controllers necessitate high-speed network switches and zonal gateways, boosting logical, analog, and memory chip demand in tandem. The European integrated circuits market size for automotive power modules is forecast to roughly double between 2025 and 2030 as silicon-carbide traction inverters scale in mainstream vehicle segments.

Industrial automation, propelled by IIoT retrofits, adds a steady growth layer, while data-center silicon in Nordic countries profits from abundant renewable energy. Aerospace and defense buyers drive margins through high-reliability gallium-nitride and radiation-hardened designs funded by European Space Agency satellite programs.

Geography Analysis

Germany’s Europe integrated circuits market leadership stemmed from a 29.3% revenue share in 2024, buoyed by automotive OEM proximity and large-scale fab investments such as TSMC’s EUR 10 billion (USD 11.77 billion) Dresden joint venture. Infineon’s Smart Power Fab—supported by EUR 1 billion (USD 1.18 billion) in EU Chips Act grants—expanded regional supply capacity for power devices and microcontrollers. Despite high industrial electricity costs, Germany leveraged a mature engineering talent base and tight OEM-supplier integration, reinforcing its hub status. Research outfits like Fraunhofer IIS accelerated the development of advanced in-car networking chips, sustaining technology spillovers into adjacent segments.

Italy emerged as the fastest-growing locale at an 8.6% CAGR outlook to 2030, catalysed by the European Commission’s EUR 1.3 billion (USD 1.53 billion) approval for Silicon Box’s chiplet-integration facility in Catania. The initiative unlocks leading-edge packaging services previously unavailable in Europe, positioning Italy as an anchor for heterogeneous integration across AI, data-center, and automotive workloads. STMicroelectronics further lifted local momentum by ramping 200 mm silicon-carbide wafer output for traction inverters, aligning with Italy’s sizeable automotive tier-1 supplier base.

France, the United Kingdom, and Nordic nations together account for a growing tranche of demand. France leveraged CEA-Leti’s R&D assets to push GaN-on-silicon RF devices into space platforms, while ST’s Tours site continued to supply high-reliability power modules to Airbus and Safran.^{[3]European Space Agency, “Going GaN: novel chips powering space missions,” esa.int} The UK’s compound-semiconductor cluster in Newport harnessed GaN expertise for 5G macro-cell base stations, securing European competitive positioning even after Brexit. Nordic countries—especially Sweden and Denmark—captured power-electronics investments tied to offshore wind and renewable-powered data centers, enabling a virtuous cycle between green energy and semiconductor manufacturing needs.