January 17, 2025 /SemiMedia/ — STMicroelectronics and GlobalFoundries have put on hold a €5.7 billion plan to build a semiconductor fab in France, casting doubt on the project's feasibility, according to reports. Announced in 2022, the initiative had secured subsidies under the European Union’s Chips Act. However, 18 months later, no substantial progress has been made.

In May 2023, the EU approved funding for the joint venture, aimed at constructing a 12-inch wafer fab to serve the automotive, industrial, 5G/6G, defense, and aerospace markets. The total project cost was estimated at €7.5 billion, supported by France’s "France 2030" initiative. Despite these commitments, recent reports suggest the project has been shelved, with its prospects now uncertain.

Meanwhile, STMicroelectronics and GlobalFoundries are increasingly prioritizing the Chinese market. In October 2024, GlobalFoundries held its annual technology summit in Shanghai, underscoring its focus on China. Mike Cadigan, the company’s chief corporate and government affairs officer, highlighted the importance of the Chinese market, while Kay Chai Ang, GlobalFoundries’ newly appointed President for Asia-Pacific and Chairman of GlobalFoundries China, outlined plans to expand regional operations.

STMicroelectronics is also accelerating its presence in China. In June 2023, CEO Jean-Marc Chery announced a collaboration with Sanan Optoelectronics to expand an 8-inch SiC wafer fab. In November 2024, ST formed a new partnership with Hua Hong Semiconductor to enhance localized manufacturing capabilities and competitiveness.

The shift highlights growing challenges for Europe’s semiconductor sector in global competition. Despite significant policy support, the French project’s delays underline persistent hurdles, while robust demand and collaboration opportunities in China are attracting global players. The strategic pivot by STMicroelectronics and GlobalFoundries is likely to reshape the global semiconductor landscape.