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The European Commission has approved a German funding measure of 5 billion euros to ESMC for the construction and operation of a new microchip factory in Dresden. ESMC
The European Commission has approved a German funding measure of 5 billion euros to ESMC for the construction and operation of a new microchip factory in Dresden.
ESMC is a joint venture between Taiwan Semiconductor Manufacturing Company (TSMC), Bosch, Infineon and NXP. This group has now received the green light from Europe for 5 billion euros in state aid. The measure contributes to European security of supply and digital sovereignty in the semiconductor industry, in line with the goals of the European Chips Law.
Germany has informed the Commission of its plans to support ESMC in building a new semiconductor factory in Dresden to produce chips for the automotive and industrial sectors. The factory will produce high-quality chips based on 300 mm silicon wafers using technologies such as 28/22 nm and 16/12 nm node sizes. TSMC is reserving cutting-edge technology (7 nm or lower) using EUV machines from ASML for the time being only for its site in Taiwan.
The factory, which is expected to be fully operational by 2029, will produce 480,000 wafers annually. The state aid of five billion euros corresponds to half the total cost of building the chip factory.
The fab will operate as an open foundry. Customers, including ESMC shareholders, will be able to purchase chips for specific applications. This business model is important for the wider European ecosystem, especially given ESMC’s commitment to supporting European SMEs and start-ups in strengthening their knowledge and skills. In addition, European universities will also have access to the fab’s production capacity, which will boost research and knowledge development in Europe.
The European Commission assessed the German aid measure under EU state aid rules. The Commission concluded that the measure promotes the development of innovative technologies and chip production in Europe and is a first of its kind in Europe. ESMC will be the first company in Europe to produce wafers with advanced technologies such as FinFET.
The support measure was also considered necessary and proportionate to ensure the resilience of the European semiconductor supply chain. The Commission concluded that the aid is proportionate and limited to the minimum necessary for the investment. In addition, ESMC has committed to sharing any excess profits with Germany.
The measure has a positive impact on the European semiconductor ecosystem and strengthens European security of supply. ESMC has also committed to prioritizing the production of crisis-relevant products in Europe in the event of a crisis, as provided for in the EU Chip Law. On the basis of these considerations, the Commission approved the aid measure.
Today ESMC is breaking ground for the construction of the factory in Dresden.
Source: IT Daily
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