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Released August 14, 2023 | GALWAY, IRELAND
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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Germany is cementing its position as a new stronghold of semiconductor chip manufacturing in Europe after Taiwan's Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) (TSMC) (Hsinchu, Taiwan) committed 3.5 billion euros (US$3.84 billion) to building its first European semiconductor manufacturing plant in Dresden.
The investment will be backed by generous government financial aid worth up to 5 billion euro (US$5.5 billion) for the plant, which will be located in the eastern state of Saxony. The European Semiconductor Manufacturing Company (ESMC) plant is being developed with other leading players, Bosch GmbH (Gerlingen, Germany), Infineon Technologies AG (Neubiberg, Germany) and NXP (NYSE:NXPI). TSMC will own 70% of the plant, with the others each controlling a 10% stake. The planned fab is expected to have a monthly production capacity of 40,000 300mm (12-inch) wafers on TSMC's 28/22 nanometer planar CMOS and 16/12 nanometer FinFET process technology. It will create 2,000 direct high-tech professional jobs. Construction will start in the second half of 2024 with production targeted to begin by the end of 2027.
It is another big win for Germany which, two months ago, saw chip major Intel Corporation (NASDAQ:INTC) (Santa Clara, California) announcing its intention to spend 30 billion euro (US$33 billion) on a new factory complex in Magdeburg. Located 150 kilometers southwest of Berlin, it will be backed with almost 10 billion euro (US$11 billion) in state subsidies. The investment is almost double the 17 billion euro (US$18.6 billion) agreed to last November and represented the largest investment in Germany by an outside company. For additional information, see June 26, 2023, article - Intel Investing $33 Billion in German Chip Plants.
German Minister of Economics Robert Habeck said that the ESMC plant will make a major contribution to supplying Germany and Europe with semiconductor chips. "Robust domestic semiconductor production is of particular importance for our global competitiveness," he commented, while Germany's Chancellor Olaf Scholz claimed that Germany "will probably now develop into the largest location for semiconductor production in Europe".
C.C. Wei, chief executive officer of TSMC, said: "Europe is a highly promising place for semiconductor innovation, particularly in the automotive and industrial fields, and we look forward to bringing those innovations to life on our advanced silicon technology with the talent in Europe."
In light of Russia's invasion of neighboring Ukraine and the ongoing trade sanctions in place, the European Union (EU) has ramped up efforts to reduce its reliance on third parties for key energy imports, raw materials and technologies. Last year, it introduced the European Chips Act, backed by 15 billion euro (US$17 billion) in additional public and private investment until 2030. This came on top of 30 billion euro (US$34 billion) of public investments that it had already planned. Within the Act, the Chips for Europe Initiative set aside 11 billion euro (US$12.4 billion) to advance semiconductor projects. The planning process has also been fast-tracked in Member States for new grassroot facilities and expansions of existing plants. For additional information, see February 21, 2022, article - Europe Enacts 'Chips Act' to Battle Semiconductor Shortages.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
The investment will be backed by generous government financial aid worth up to 5 billion euro (US$5.5 billion) for the plant, which will be located in the eastern state of Saxony. The European Semiconductor Manufacturing Company (ESMC) plant is being developed with other leading players, Bosch GmbH (Gerlingen, Germany), Infineon Technologies AG (Neubiberg, Germany) and NXP (NYSE:NXPI). TSMC will own 70% of the plant, with the others each controlling a 10% stake. The planned fab is expected to have a monthly production capacity of 40,000 300mm (12-inch) wafers on TSMC's 28/22 nanometer planar CMOS and 16/12 nanometer FinFET process technology. It will create 2,000 direct high-tech professional jobs. Construction will start in the second half of 2024 with production targeted to begin by the end of 2027.
It is another big win for Germany which, two months ago, saw chip major Intel Corporation (NASDAQ:INTC) (Santa Clara, California) announcing its intention to spend 30 billion euro (US$33 billion) on a new factory complex in Magdeburg. Located 150 kilometers southwest of Berlin, it will be backed with almost 10 billion euro (US$11 billion) in state subsidies. The investment is almost double the 17 billion euro (US$18.6 billion) agreed to last November and represented the largest investment in Germany by an outside company. For additional information, see June 26, 2023, article - Intel Investing $33 Billion in German Chip Plants.
German Minister of Economics Robert Habeck said that the ESMC plant will make a major contribution to supplying Germany and Europe with semiconductor chips. "Robust domestic semiconductor production is of particular importance for our global competitiveness," he commented, while Germany's Chancellor Olaf Scholz claimed that Germany "will probably now develop into the largest location for semiconductor production in Europe".
C.C. Wei, chief executive officer of TSMC, said: "Europe is a highly promising place for semiconductor innovation, particularly in the automotive and industrial fields, and we look forward to bringing those innovations to life on our advanced silicon technology with the talent in Europe."
In light of Russia's invasion of neighboring Ukraine and the ongoing trade sanctions in place, the European Union (EU) has ramped up efforts to reduce its reliance on third parties for key energy imports, raw materials and technologies. Last year, it introduced the European Chips Act, backed by 15 billion euro (US$17 billion) in additional public and private investment until 2030. This came on top of 30 billion euro (US$34 billion) of public investments that it had already planned. Within the Act, the Chips for Europe Initiative set aside 11 billion euro (US$12.4 billion) to advance semiconductor projects. The planning process has also been fast-tracked in Member States for new grassroot facilities and expansions of existing plants. For additional information, see February 21, 2022, article - Europe Enacts 'Chips Act' to Battle Semiconductor Shortages.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
