Brussels says it wants the EU to have a 20% share of the global market for microchips by the end of the decade.
It has created an alliance in a bid to boost the continent's industrial capacity for the components, also known as semiconductors.
The market is dominated by Asia but recent global supply issues have prompted the European Commission to act.
"We are aiming at 20 per cent of global market share in ten years from now, that's enough for our needs," said Thierry Breton, the European Commissioner for Internal Market Affairs. "The USA is trying to reach 30 per cent.
"We all do have the ambition now to make Europe THE place on planet earth where the strongest and most performing semiconductors will be produced... what's important for us: to get the production done here, in Europe, in our place, in order to guarantee the security of the supply chain."
But there are doubts over whether the EU will be able to trigger the construction of a brand-new production site for semiconductors soon.
The European Commission has charged the new alliance with identifying the needs and bottlenecks of the industry.It then wants it to create a roadmap for Europe obtaining a 20% share of the global market by 2030.