Infineon rises as construction starts on new German chip plant
Sean Gallup
Infineon (OTCQX:IFNNY) shares rose around 1% in mid-day trading on Tuesday as the semiconductor company broke ground on a new manufacturing plant in its home country of Germany.
The new plant, which is set in Dresden, will start producing chips in 2026, the company said. It comes after the European Union passed its 45Bâ¬ ($47B) Chips Act last month in an effort to better compete with the U.S. and China for semiconductor production.
Speaking at the groundbreaking ceremony in Dresden, European Commission President Ursula von der Leyen said the continent was well aware that it needs to boost its semiconductor supply chain.
"We are all experiencing how drastically geopolitical risks have grown. This is why it is vital that we in Europe strengthen the supply chains of our most important goods and technologies," von der Leyen said in a speech obtained by Reuters.
Germany, which has its own semiconductor industry, including Infineon, Bosch and others, has worked to increase chip-related investment in the country.
Last March, Intel (INTC) said it would invest approximately $88B, or 80Bâ¬, in chip manufacturing in Europe over the next decade, including an $18.6B mega fab in Germany.
The company is reportedly still working with the German government on subsidies for the plant.
In February, Wolfspeed (WOLF) said it would build a new $2.3B plant in Saarland, Germany, producing cutting edge 200 mm wafers.
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