Market evolution: Semiconductor devices (CN 8541) — 2015–2025

Introduction

This report examines the evolution of EU trade in semiconductor devices under Combined Nomenclature code 8541 between 2015 and 2025. The product scope is broad, encompassing diodes, transistors, photosensitive semiconductor devices, photovoltaic cells (whether or not assembled in modules or panels), light-emitting diodes (LEDs), mounted piezoelectric crystals, and parts thereof. Over the period under review, the EU semiconductor trade landscape has been reshaped by three powerful and interrelated forces: a massive surge in solar photovoltaic imports from China, a widening structural trade deficit, and increasing concentration of import supply sources. These dynamics carry significant implications for the EU's industrial competitiveness and strategic autonomy.

A Solar-Driven Import Boom: Quantity Explodes, Unit Prices Collapse

The widening trade deficit masks divergent price and volume trends

At the headline level, EU trade in CN 8541 shows a dramatic structural shift over the decade. Exports rose moderately from €5.5 billion in 2015 to €7.5 billion in 2025 (+36.5%), while imports nearly doubled from €8.0 billion to €14.7 billion (+84.4%). The resulting trade deficit widened from €2.5 billion to €7.2 billion — a deterioration of 191%.

The most striking feature is the divergence between import quantity and import price. Import volumes surged by over 1,000%, while unit values collapsed by 83.8%. This pattern is inconsistent with a broad-based semiconductor demand shock and instead points to a specific product segment driving the trend.

Photovoltaic modules account for the bulk of import volume growth

The product segment breakdown reveals that the import surge is overwhelmingly concentrated in one sub-product: photovoltaic cells assembled in modules or panels (CN 854143). By 2025, this single category accounted for approximately 4.46 million tonnes out of a total import volume of roughly 4.50 million tonnes — that is, over 99% of all imported semiconductor device weight.

The unit price of imported PV modules fell from €5,094/t in 2022 (the first year with available sub-product data) to just €1,785/t in 2025 — a decline of 65% in only three years. This reflects the global oversupply in solar manufacturing capacity, driven primarily by massive expansion of Chinese production. In value terms, PV module imports still represented nearly €8.0 billion in 2025, down from a peak of €22.3 billion in 2022, as the volume plateau coincided with severe price erosion.

Other semiconductor categories show more typical trade patterns

When PV products are excluded, the remaining sub-categories display far more stable trade volumes and rising prices — consistent with global semiconductor market dynamics such as growing demand for power electronics, automotive chips, and LEDs. For instance, imports of transistors with dissipation ≥1 W (CN 854129) grew in value from €1.19 billion to €2.47 billion, with unit prices rising from €208,570/t to €300,479/t. Exports of the same category grew even faster, from €871 million to €2.60 billion, with export unit prices increasing from €343,794/t to €656,712/t, suggesting the EU maintains a competitive position in higher-value semiconductor segments.

China's Dominance and Rising Import Concentration

China has become the EU's overwhelmingly dominant import source

The partner-level data shows a dramatic reorientation of EU semiconductor imports toward China. In 2015, China supplied €2.6 billion of the EU's €8.0 billion in semiconductor imports — a 32% share. By 2025, Chinese imports had risen to €10.2 billion out of €14.7 billion, representing a 69% share.

The declines from Taiwan (−78.8%), South Korea (−63.3%), and Singapore (−55.5%) are notable. These are traditionally strong semiconductor manufacturing hubs. The data suggests that China's role has expanded not only in solar PV — where it already dominates globally — but also in absorbing re-routing of semiconductor supply chains, potentially including packaging and assembly activities that previously took place in Southeast Asia.

The Herfindahl-Hirschman Index confirms alarming supply concentration

The import concentration index (HHI) for imports by value rose from 1,691 in 2015 to 5,178 in 2025 — an increase of 206%. An HHI above 2,500 is generally considered to indicate a highly concentrated market. By 2025, EU semiconductor imports are firmly in this territory, with China as the near-monopolistic supplier by volume.

Export concentration, by contrast, remained moderate and actually declined slightly (HHI fell from 1,144 to 1,061), indicating that EU exporters serve a diversified set of markets. The asymmetry between import and export concentration is a key vulnerability: while the EU sells broadly, it buys increasingly from a single source.

Strategic Vulnerability: Production Stagnation and Growing Import Dependence

EU domestic production has grown in value but barely in volume

The production data reveals a mixed picture. In value terms, EU production of CN 8541 products grew from €3.7 billion to €11.6 billion (+212.6%), suggesting a shift toward higher-value manufacturing. However, in terms of unit quantity (measured in number of items), production was essentially flat — rising only 3.2% from 27.7 billion to 28.5 billion items, with a trough of 18.0 billion during the period.

This pattern is consistent with the EU focusing on specialty semiconductors (e.g., power transistors, automotive-grade devices) where unit prices are high, while ceding high-volume, lower-value production (especially solar PV) to Asian competitors. The EU's export propensity — the share of domestic production that is exported — declined from 71.3% to 64.5%, suggesting that more of the EU's high-value output is now consumed domestically rather than exported.

Net import reliance has more than doubled

The EU's net import reliance for CN 8541 rose from 18.5% in 2015 to 47.0% in 2025, having peaked at 67.8% in an intermediate year. This means that nearly half of the EU's semiconductor consumption (in value terms) is now satisfied by imports net of exports. Trade intensity — the sum of imports and exports as a share of domestic production — remained very high at around 86%, underlining the deeply globalised nature of this market.

Within the EU, the member-state-level data shows that Germany remains the largest exporter (€3.5 billion in 2025) and the second-largest importer (€4.2 billion), reflecting its role as both a semiconductor consumer and a producer of high-value devices. The Netherlands is the largest importer (€3.6 billion), likely reflecting the role of Rotterdam as a gateway port and the presence of ASML's supply chain. Notably, Spain's imports surged by 830% over the period — from €95 million to €882 million — suggesting rapid growth in solar PV deployment.

Specialisation patterns reveal a fragmented European landscape

The revealed comparative advantage analysis for 2025 shows that only a handful of EU member states display a comparative advantage in CN 8541 products. Slovenia (RSCA: 0.66), Greece (0.48), Portugal (0.45), the Netherlands (0.33), and Austria (0.25) are the most specialised, while large economies such as Ireland (RSCA: −0.76) and Finland (−0.85) show negative specialisation. This fragmentation suggests that the EU's semiconductor ecosystem remains geographically uneven, with production capacity concentrated in a few member states rather than distributed across the bloc.

Conclusion

The EU's trade in semiconductor devices (CN 8541) between 2015 and 2025 has been dominated by the explosive growth of photovoltaic imports from China. The import volume of solar modules surged by over 1,000%, while their unit price collapsed by more than 80%, driven by massive overcapacity in Chinese manufacturing. This single product category has fundamentally reshaped the headline trade statistics, widening the EU's trade deficit from €2.5 billion to €7.2 billion and pushing import concentration (HHI) to levels that signal high supplier dependence.

Beneath the solar-driven headline, the EU's position in higher-value semiconductor segments — power transistors, diodes, LEDs, and specialty devices — appears more resilient. Export values in these categories have generally risen, and EU production has shifted toward higher unit values. However, the overall net import reliance has more than doubled to 47%, and the overwhelming dominance of China as a supplier source poses a clear strategic vulnerability. For European policymakers, the data underscores the dual challenge of supporting domestic semiconductor manufacturing capacity (the ambition behind the European Chips Act) while managing the trade implications of a global solar energy transition that has, to date, been powered almost entirely by Chinese production.