According to reports, this investment is unique since it was achieved without the use of government subsidies made possible by the EU’s Chips Act, which was enacted in 2023.
The Netherlands-based Nexperia, a fundamental semiconductor manufacturer owned by China, revealed last week that it will be investing $200 million to boost production at its main Hamburg, Germany, site.
The financing is thought to be a singular example of a European computer chip investment that is independent of government subsidies from the EU’s Chips Act, which was implemented in 2023.
With this investment, Nexperia plans to set up production lines in Hamburg for two different kinds of “wide bandgap” chips made of gallium nitride (GaN) and silicon carbide (SiC).
These chips work well in high-temperature and high-voltage environments and are favored over conventional silicon chips because of their efficiency, speed, and light weight.
This statement coincided with the launch of an EU investigation into possible improper subsidies from China for conventional chips used in European products such as Nexperia.
The European governments have been closely monitoring Nexperia since the Chinese business WingTech purchased the Nijmegen, Netherlands-based company for $3.6 billion in 2018. Because of security concerns, the British government made Nexperia sell a facility in Newport in 2022.
The German government refused to provide Nexperia with a subsidy for creating battery efficiency technologies, despite the Dutch government having cleared the company’s commercial operations the previous year.
Approximately 100 billion of these chips are produced by Nexperia each year, making up nearly 25% of the total supply worldwide. Production for the company is done in Europe; packaging and assembly are done in China, Indonesia, and the Philippines.
The business was split off from NXP, which was formerly Philips’ chip manufacturing division, in 2017. 10% of its sales are to customers in China, where it competes with NXP, Texas Instruments, and Infineon in the automotive sector.
The CFO, Stefan Tilger, claims that Nexperia chips are critical to the advancement of new technologies in the areas of digitalization, green energy, and electric vehicles.
Hannes van Raemdonck, head of advocacy at Nexperia, told Reuters that the business had big expansion goals. According to him, Nexperia is making investments in order to profit from developments like electrification and the rising need for automotive semiconductors.
