- Aug 17, 2014
According to a new report, Germany's government plans to allocate €20 billion ($22 billion) to enhance semiconductor production in the country. This initiative is designed to strengthen the national tech industry and ensure a steady supply of key components in light of increasing geopolitical instability. A significant proportion of these funds, approximately 75%, is earmarked for multinationals such as Intel from the U.S. and TSMC from Taiwan, Bloomberg reports.
The aid package is set to be distributed by 2027. About half of the aid package, €10 billion (a third of the total investment in the site), is said to have been allocated to Intel for its new production facility near Magdeburg, Germany, Eastern Germany. The German government is also finalizing negotiations with TSMC to invest in a manufacturing facility in Dresden and build various microcontrollers that are consumed by Germany-based automakers. The government is looking forward to subsidizing around €5 billion, half of the total investment, in this fab.
Furthermore, approximately €1 billion is designated for Infineon, around 20% of the total investment in a new Dresden-based semiconductor plant, Bloomberg report. In addition, German automotive supplier ZF Friedrichshafen AG and U.S.-based chipmaker Wolfspeed are also expected to receive state funds to establish a silicon carbide chip factory near the French border in Saarland. The joint venture seeks subsidies covering roughly 25% of the costs, which equates to about €750 million.