Infineon to receive nearly €1 billion in subsidies to build chip plant

Three years ago, European authorities approved a local “Chip Law” that, following the American example, provided for the allocation of subsidies for the construction of chip manufacturing plants in Europe. The sixth recipient of these subsidies should be Infineon, which will build a multi-profile enterprise in Germany for the production of integrated circuits and power electronics.

Image source: Infineon Technologies

With a total construction budget of around €3.5 billion in Dresden, Infineon can claim €920 million in subsidies, but it also has certain obligations towards the European Commission. Firstly, if there is a shortage of certain semiconductor components in the region, Infineon must prioritise their production under the supervision of the EU authorities. Secondly, it must invest in the development of advanced semiconductor components in the region. Infineon also undertakes to provide local research labs with access to its production facilities for the production of prototype semiconductor components.

At Megafab-DD in Dresden, Infineon is expected to be able to produce either power electronics for use in the electric vehicle and home appliance industries, or chips for both digital and analog signals, in varying proportions. The main customers for the products of the future Infineon plant in Dresden are expected to be customers from the automotive industry, consumer electronics, and industrial automation.

Before this, the European Commission had already approved subsidies for STMicroelectronics, which is going to build two plants in France and Italy, one of which will be managed jointly with GlobalFoundries. In addition, the first of the companies will build a silicon wafer production plant in Italy. Infineon will simultaneously be involved in the construction of a joint venture with TSMC in the same Dresden, this project will also receive support from the European budget. Finally, in December last year, the Italian authorities approved subsidies for Silicon-Box to build a chip testing and packaging plant in Italy.