Industrial customers must provide firm order commitments before semiconductor manufacturers absorb the high capital risks of building additional facilities. Semiconductor executives argue that despite heavy ongoing investments in European production, long-term operational feasibility hinges on shared customer responsibility and continuous state subsidies. Jochen Hanebeck noted ahead of the electronica trade fair that while public funding and engineering expertise drive regional growth, European chipmakers still confront an uneven playing field compared to international rivals. This dynamic will shape the future pace of domestic manufacturing infrastructure.
Key points
Additional semiconductor production capacity requires binding commitments from clients to…: Additional semiconductor production capacity requires binding commitments from clients to mitigate the financial burden placed on manufacturers.
Ongoing government subsidies remain a critical necessity for chip companies to justify ma…: Ongoing government subsidies remain a critical necessity for chip companies to justify major infrastructure investments within Europe.
European chipmakers continue to operate on an uneven playing field when competing against…: European chipmakers continue to operate on an uneven playing field when competing against international industry peers.
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MUNICH, Nov 10 : German chipmaker Infineon needs commitments from customers to justify further expansion of its semiconductor production capacity, CEO Jochen Hanebeck said on Monday.
Speaking at an industry event ahead of the electronica trade fair in Munich, Hanebeck said chipmakers were already investing heavily in production and research, but could not shoulder the financial risks of expansion alone.
"There are limits to what we can shoulder," Hanebeck said, adding that customer commitments were "definitely" needed to bring additional capacity online.
Infineon opened a new €5 billion ($5.6 billion) semiconductor factory in Dresden, Germany in July, and in October announced plans to invest around €1.1 billion in gallium nitride chip production in Villach, Austria.
Hanebeck said government support remained essential to attracting semiconductor investment, citing economies of scale, existing engineering expertise and public funding as the reasons Infineon continued to expand its European factories.
"What we get in Europe is substantial, but as compared to other regions, it's still certainly not a level playing field," he said.
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