European Commission officials have tabled plans to boost the production of embedded chips in Europe, with the aim of becoming a world leader.

A public/private partnership, the European Technology Platform Advanced R&D on Intelligent Systems (Artemis) will be set up by the end of the year to oversee the initiative.

Artemis is charged with ensuring that the small chips and associated software embedded in numerous appliances such as cars and mobile phones can work with each other via industry standards.

The group is to focus on technical challenges, including radical designs to lower power consumption from chips, as well as interconnecting large numbers of embedded systems.

According to Commission figures, the proportion of a car's value that depends on these embedded systems could, by 2010, be as high as 40 per cent. In 1997 the figure was just 22 per cent.

Europe must be at the forefront of developing embedded technologies if it wants to take advantage of the rise in these systems, said Erkki Liikanen, the European Enterprise and Information Society commissioner.

Speaking in Rome Liikanen said: "The impact of embedding ICT is enormous. Success in this domain will result in the strengthening and competitiveness of European industry."

To date 17 companies, including Nokia, BT Exact and Philips, have signed up to become members of Artemis.