As Europe works to lessen its reliance on Asia and the US, US chipmaker Wolfspeed announced in late January that it will construct a plant in Germany to facilitate the automotive industry’s transition to electric vehicles. According to the corporation, the factory will be constructed in the western state of Saarland as part of Wolfspeed’s previously stated $6.5 billion development plan.
Olaf Scholz, the German chancellor, said the factory would “significantly contribute to ensuring that our European industry is supplied with semiconductors in a reliable manner” when he visited Saarland for the announcement. He claimed that supply chain snarls during the epidemic revealed how overly dependent Europe has grown on foreign chip imports in recent years, upsetting a number of companies that depend on the components.
The factory, according to Wolfspeed, would cost more than two billion euros and house the largest silicon carbide chip manufacturing facility in the world. Gregg Lowe, president and chief executive officer of Wolfspeed, said: “This new facility will be vital to supporting our expansion in a capacity-constrained industry that is developing extremely rapidly, especially throughout the EV (electric vehicle) markets).
In exchange for a stake in Wolfspeed, German component manufacturer ZF Friedrichshafen announced it will invest “three-digit million euros” in the new building. Volkswagen and other German auto industry giants are stepping up their attempts to produce high-tech electric automobiles rather than dirty ones that burn fossil fuels.
The facility, Wolfspeed’s first in Europe, will be constructed in Ensdorf on 35 acres (14 hectares) of disused coal-fired power plant land. The European Commission must approve state funding for the project. According to Wolfspeed, construction on the plant is scheduled to start in the first half of 2023.