EU Approves €5 Billion for German Chip Plant, Boosting European Semiconductor Industry
Dresden, Wednesday, 28 August 2024.
The European Commission has approved a €5 billion German state aid measure to support ESMC’s new semiconductor facility in Dresden. This strategic investment aims to strengthen Europe’s chip manufacturing capabilities and reduce reliance on non-European suppliers.
Strengthening Europe’s Semiconductor Supply Chain
The European Semiconductor Manufacturing Company (ESMC) is a joint venture between Taiwan Semiconductor Manufacturing Company (TSMC), Bosch, Infineon, and NXP. This collaboration aims to create a robust semiconductor manufacturing ecosystem in Europe. By establishing a state-of-the-art facility in Dresden, Germany, ESMC will significantly bolster Europe’s semiconductor supply chain, enhancing its security, resilience, and digital sovereignty in line with the objectives outlined in the European Chips Act[1].
The Technology Behind the Innovation
The new facility will utilize advanced semiconductor manufacturing technologies, including 300mm silicon wafers with node sizes of 28/22nm and 16/12nm. These wafers will be produced using field-effect transistor (FinFET) technology, which allows for the integration of multiple features into a single chip. This results in high-performance chips that consume less power, making them ideal for automotive and industrial applications[1]. The Dresden plant is expected to operate as an open foundry, allowing any customer to place orders for specific chip production, thereby increasing its utility and impact across different sectors.
Economic and Environmental Impact
The ESMC facility is projected to create approximately 2,000 high-tech jobs directly and stimulate numerous indirect jobs throughout the EU supply chain[2]. Beyond its economic benefits, the facility is designed with sustainability in mind, employing energy-efficient construction methods, water reclamation, and aiming for LEED certification. This focus on sustainability aligns with broader European goals of achieving the digital and green transitions[1][3].
Future Prospects and Strategic Importance
Construction of the ESMC semiconductor fab is expected to begin later in 2024, with full operational capacity anticipated by 2029. Once operational, the facility will produce around 480,000 silicon wafers per year, significantly contributing to the semiconductor needs of the rapidly growing European automotive and industrial sectors[2][4]. TSMC Chairman & CEO C.C. Wei emphasized that this facility would bring TSMC’s advanced manufacturing capabilities closer to European customers and partners, driving technological advancements and economic development within the region[4].
A Milestone for European Technology
The groundbreaking ceremony for the Dresden fab, held on August 27, 2024, marks a historic milestone for the German and European microelectronics industry. Distinguished attendees included Ursula von der Leyen, President of the European Commission, and Olaf Scholz, German Chancellor. The establishment of ESMC is part of TSMC’s Grand Alliance, aimed at enhancing collaboration in the semiconductor industry and driving innovation across Europe[4][5].