This funding will enable Infineon to advance the MEGAFAB-DD project, which is designed to produce a diverse array of semiconductor chips, according to the Commission.
Globally, chip manufacturers are investing billions into new facilities, leveraging substantial subsidies from both the United States and the EU to maintain a competitive edge over China in the development of advanced semiconductor technologies.
By 2030, the European Commission has allocated 15 billion euros for both public and private semiconductor initiatives.
The Commission emphasized that this new manufacturing facility will enhance flexible production capabilities within the EU, thereby bolstering Europe's supply security, resilience, and technological independence in semiconductor technologies, in alignment with the goals outlined in the European Chips Act.
The plant, expected to reach full operational capacity by 2031, will serve as a front-end facility, encompassing wafer processing, testing, and separation. Its chips will cater to industrial, automotive, and consumer markets.
The aid will be provided as a direct grant of up to 920 million euros to Infineon, supporting its total investment of 3.5 billion euros. Infineon has indicated that this project represents the largest single investment in its history.
In collaboration with the EU, Infineon has committed to ensuring that the project yields broader positive impacts on the EU semiconductor value chain and to invest in research and development for the next generation of chips in Europe.
Additionally, the project will enhance crisis preparedness by pledging to prioritize orders in the event of supply shortages, in accordance with the European Chips Act.