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Germany is Home to Over Half of New EU Microchip Projects

A new study by Germany Trade & Invest (GTAI) identifies state support as the main reason for the current boom in semiconductor production in Europe’s largest market.

Ten of the 16 microchip plant projects in the European Union are located in Germany, as detailed by the GTAI overview. They include Intel’s massive EUR 38 billion megafabs in Magdeburg as well as TSMC’s new EUR 11 billion facility and Infineon’s EUR five billion expansion, both in the Dresden area. Bosch, Global Foundries, Vishay and X-Fab are also expanding in various parts of the country, while Wolfspeed is building a EUR 2.5 billion plant in the southwestern German town Ensdorf.

One crucial reason for all the activity, GTAI found, was state financial support, in particular under the European Union Chips Act. It aims to increase the bloc’s share in global chip production from its current 10 percent to at least 20 percent by 2030. Such support makes it feasible for the world’s largest semiconductor producers to expand to Germany and enjoy proximity to European and world-leading industries such as Germany’s automotive sector. 

“The fact that Germany has established itself as the clear center of European microchips shows that the country remains a viable location for industrial production,” says Germany Trade & Invest CEO Robert Hermann. “Conversely, the existing and planned production of semiconductors increases the strength and resilience of value chains in Germany and makes the country an even more attractive business location for international companies.”

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