Modern vehicles are, in a very real sense, computers on wheels. A typical car now contains hundreds of chips governing everything from engine management and safety systems to infotainment and increasingly sophisticated driver assistance. For Europe, whose economy leans heavily on its automotive industry, this dependence carries significant strategic weight.

How the shortage exposed the risk

The chip shortages that disrupted global supply chains hit carmakers especially hard. Many of the affected components were not exotic leading-edge parts but relatively ordinary mature-node chips. When these became scarce, production lines stalled, vehicles could not be completed, and the economic cost mounted quickly. The episode revealed how a shortfall of humble components could paralyse a flagship industry.

Why automotive chips are distinctive

• They must meet stringent reliability and safety standards.
• They often rely on established, mature process nodes.
• They have long product lifecycles measured in many years.

These characteristics mean automotive chips cannot simply be swapped for whatever is available. Qualification is rigorous and time-consuming, which is part of why supply disruptions proved so difficult to resolve.

The push for sovereignty

In response, European policymakers and manufacturers have sought greater control over their chip supply, whether through domestic capacity, closer partnerships with foundries, or strategic stockpiling and better forecasting. Initiatives such as the EU Chips Act explicitly reflect this concern, and Europe’s existing strength in automotive and industrial semiconductors gives it a foundation to build on.

Full self-sufficiency remains unrealistic, given the global nature of the industry, but reducing acute vulnerability is a widely shared goal. As vehicles grow ever more electronic, the demand for capable chip designers and engineers only rises, making strong design skills an increasingly valuable asset across the sector.