UK chips sector can compete with Taiwan with a US-style strategy, says IQE boss
A strategy to rival the US’ Chips Act would allow the UK to compete with the likes of Taiwan, China and the States, the CEO of chipmaker IQE has told City PM today.
“It would really position IQE and the UK as a world leader of compound manufacturing,” Americo Lemos said. “It would allow the UK to have a seat at the semiconductor table alongside Taiwan.”
Taiwan, an island around seven times smaller than the UK, is the world’s largest chipmaking hub.
Speaking to City A.M., the chipmaking chief said “there’s going to be a tremendous effort” to apply the funds received from the US’ $52bn semiconductor bill, which passed in August.
“We have a pretty good platform to benefit from the initiative,” he said. “But we are also working with the UK government so that we also put a semiconductor strategy in place [here].”
The gameplan for computer chips, from a government perspective, is “in the spotlight everywhere the we look from the US to Asia,” Lemos continued.
Chief financial officer Tim Pullen added that governments around the world are throwing capital behind securing their supply of semiconductors, which are increasingly in demand from a raft of sectors.
“Governments are investing alongside industry to create manufacturing capacity and that’s what we really need to see from the new leadership in the UK,” he said, adding that this can be done with a strategy “that does the same” as the US.
The London-listed company, which primarily serves aerospace, security and 5G customers, is betting on the metaverse as the next big customer, as the automotive industry ups its demand in the name of electrification.
“We are growing in many different sectors,” said Lemos, who noted that the players within the metaverse space are some of the biggest investors currently. “We’re looking at industries like automotive, where we look at the power of electric vehicles and the power that goes into autonomous driving.”
IQE’s revenue jumped more than eight per cent to £86.2m in the six months to 30 June, up from £79.5m in the same period last year.
However, as the company seeks to trim outgoings in the long term, IQE shouldered a £7.4m loss for the period, due to planned costs associated with the closure of its Singapore site in June and its US-based Pennsylvania site, which is expected to be completed by 2024.
Pullen explained that in a bid to shrink costs, IQE has redirected its US manufacturing efforts into its larger North Carolina facility.