Infineon Technologies AG (FSE: IFX / OTCQX: IFNNY) is starting construction of its new plant for analog/mixed-signal technologies and power semiconductors. After extensive analysis, the Infineon Management Board and supervisory bodies gave the green light for the Dresden site. The German Federal Ministry for Economic Affairs and Climate Action (BMWK) has approved an early project launch, meaning that construction can already begin before completion of the inspection of legal subsidy aspects by the European Commission. Subject to the European Commission’s state aid decision and the national grant procedure, the project is to be funded in accordance with the objectives of the European Chips Act. Infineon is seeking public funding of around one billion euros. The company plans to invest a total of approximately five billion euros in the plant, which is set to begin production in 2026. This constitutes the largest single investment in the company’s history.
“We’re picking up the pace by expanding our production capacities in order to leverage the growth opportunities which the megatrends decarbonization and digitalization are offering us,” says Infineon CEO Jochen Hanebeck. “We see structurally growing demand for semiconductors, for example for use in renewable energies, data centers and electro-mobility. By building the 300mm Smart Power Fab in Dresden we are establishing the prerequisites necessary to successfully meet the rising demand for semiconductor solutions.”
Infineon’s investment is an essential contribution to achieving the European Commission’s declared objective of reaching a 20 percent share of global semiconductor production in the EU by 2030. Semiconductor solutions for industrial and automotive applications from the Dresden Fab will help secure value chains in key European industries even better in the future.
In addition, the investment by Infineon strengthens the manufacturing basis for the semiconductors that drive decarbonization and digitalization. Analog/mixed-signal components are used in power supply systems, for example in energy-efficient charging systems, small automotive motor control units, in data centers and in applications for the Internet of Things (IoT). The interaction of power semiconductors and analog/mixed-signal components makes it possible to create particularly energy-efficient and intelligent system solutions.
Expansion of production capacities at the existing Dresden site will let Infineon complete the project quickly and will also generate considerable effects of scale. Construction is set to begin in 2023, with the beginning of manufacturing activities planned for fall 2026. The expansion will create approximately 1,000 highly qualified jobs. When operating at full capacity, the Dresden Fab will let Infineon achieve additional revenues on the order of the investment amount each year.
The plant will be equipped with the latest in environmental technologies and will be among the most environmentally friendly manufacturing facilities of its kind. Thanks to advanced digitalization and automation, Infineon is also setting new manufacturing excellence standards in Dresden. The new plant will be closely linked with the Infineon Villach site as “One Virtual Fab”. This manufacturing complex for power electronics based on highly efficient 300-millimeter technology will increase efficiency levels and give Infineon additional flexibility in order to supply its customers faster.