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Released September 02, 2024 | GALWAY, IRELAND
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GALWAY, IRELAND--September 2, 2024--Written by Martin Lynch, European News
Editor for Industrial Info (Galway, Ireland)--The European Commission (EC) has approved a 5 billion-euro (US$5.6 billion) financing plan by Germany to help build a new semiconductor manufacturing facility in Dresden.
The green light was given on the same day that Commission president Ursula von der Leyen attended the groundbreaking ceremony for the European Semiconductor Manufacturing Company (ESMC) chip plant. ESMC is a joint venture between Taiwan's Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) (TSMC) (Hsinchu, Taiwan), Germany's Bosch GmbH (Gerlingen, Germany) and Infineon Technologies AG (Neubiberg, Germany) and Dutch chip firm NXP (NYSE:NXPI) (Eindhoven, Netherlands). Germany's government is prepared to fund half of the proposed 10 billion-euro (US$11.2 billion) project costs. TSMC will control a 70% stake in the project while the other shareholders will each have a 10% stake. Production is targeted to begin by the end of 2027.
The Commission said the plant will strengthen Europe's security of supply, resilience and digital sovereignty in semiconductor technologies. The plant, which is planned to be operating at full capacity by 2029, is expected to produce 480,000 silicon wafers per year and employ up to 2,000 people. It will deliver high-performance chips, based on 300-millimeter silicon wafers using field-effect transistor (FinFET) technology and allowing the integration of several additional features in one chip. The claimed benefits are chips with better performance and reduced total power consumption.
"The world's largest chipmaker is coming to our continent and joining forces with three European champions," von der Leyen stated at the ceremony. "And the benefits will be felt well beyond Dresden and Saxony. European workers will gain 11,000 new jobs, both here and across our continent. European chip companies will gain access to new technologies and production capacities. European industries will benefit from more reliable local supply chains, and new products that are tailored to their needs. And at a time of growing geopolitical tensions, TSMC will also benefit from geographic diversification to Europe."
Following Russia's unprovoked attack on Ukraine in January 2022, the European Union (EU) has set in motion a number of major drives to reduce its reliance on third parties for most of its needs across a number of sectors, including energy, technology, and rare metals and minerals. In 2022, it introduced the European Chips Act, to double Europe's share of global chip production to 20%. It backed that with 15 billion euro (US$17 billion) in additional public and private investment until 2030, which came on top of 30 billion euro (US$34 billion) of public investments that were already announced. 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.
"It is upon Europe's industrial strength, that we have built our European Chips Act," von der Leyen added: "It has been three years now since we set the goal to double Europe's share of global chip production to 20%. And since then, we have seen new state-of-the-art chip factories break ground across Europe. If you take Crolles near Grenoble, or Catania in Sicily. And now another here in Dresden. This new fab qualifies under the European Chips Act as a so-called first-of-a-kind facility. In other words, it will manufacture products that are not present or planned in any other facility across Europe. This means that this facility is also entitled to national financial support."
Last summer, Industrial Info reported that chip major Intel Corporation (NASDAQ:INTC) (Santa Clara, California) was planning to spend 30 billion euro (US$33 billion) on a new factory complex in Magdeburg, south of Berlin. It is the largest investment ever in the country by an outside firm, and Germany has promised to back that with almost 10 billion euro (US$11 billion) in state subsidies. For additional information, see June 26, 2023, article - Intel Investing $33 Billion in German Chip Plants.
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 green light was given on the same day that Commission president Ursula von der Leyen attended the groundbreaking ceremony for the European Semiconductor Manufacturing Company (ESMC) chip plant. ESMC is a joint venture between Taiwan's Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) (TSMC) (Hsinchu, Taiwan), Germany's Bosch GmbH (Gerlingen, Germany) and Infineon Technologies AG (Neubiberg, Germany) and Dutch chip firm NXP (NYSE:NXPI) (Eindhoven, Netherlands). Germany's government is prepared to fund half of the proposed 10 billion-euro (US$11.2 billion) project costs. TSMC will control a 70% stake in the project while the other shareholders will each have a 10% stake. Production is targeted to begin by the end of 2027.
The Commission said the plant will strengthen Europe's security of supply, resilience and digital sovereignty in semiconductor technologies. The plant, which is planned to be operating at full capacity by 2029, is expected to produce 480,000 silicon wafers per year and employ up to 2,000 people. It will deliver high-performance chips, based on 300-millimeter silicon wafers using field-effect transistor (FinFET) technology and allowing the integration of several additional features in one chip. The claimed benefits are chips with better performance and reduced total power consumption.
"The world's largest chipmaker is coming to our continent and joining forces with three European champions," von der Leyen stated at the ceremony. "And the benefits will be felt well beyond Dresden and Saxony. European workers will gain 11,000 new jobs, both here and across our continent. European chip companies will gain access to new technologies and production capacities. European industries will benefit from more reliable local supply chains, and new products that are tailored to their needs. And at a time of growing geopolitical tensions, TSMC will also benefit from geographic diversification to Europe."
Following Russia's unprovoked attack on Ukraine in January 2022, the European Union (EU) has set in motion a number of major drives to reduce its reliance on third parties for most of its needs across a number of sectors, including energy, technology, and rare metals and minerals. In 2022, it introduced the European Chips Act, to double Europe's share of global chip production to 20%. It backed that with 15 billion euro (US$17 billion) in additional public and private investment until 2030, which came on top of 30 billion euro (US$34 billion) of public investments that were already announced. 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.
"It is upon Europe's industrial strength, that we have built our European Chips Act," von der Leyen added: "It has been three years now since we set the goal to double Europe's share of global chip production to 20%. And since then, we have seen new state-of-the-art chip factories break ground across Europe. If you take Crolles near Grenoble, or Catania in Sicily. And now another here in Dresden. This new fab qualifies under the European Chips Act as a so-called first-of-a-kind facility. In other words, it will manufacture products that are not present or planned in any other facility across Europe. This means that this facility is also entitled to national financial support."
Last summer, Industrial Info reported that chip major Intel Corporation (NASDAQ:INTC) (Santa Clara, California) was planning to spend 30 billion euro (US$33 billion) on a new factory complex in Magdeburg, south of Berlin. It is the largest investment ever in the country by an outside firm, and Germany has promised to back that with almost 10 billion euro (US$11 billion) in state subsidies. For additional information, see June 26, 2023, article - Intel Investing $33 Billion in German Chip Plants.
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).
