Globalfoundries receives 495 million euros for foundry expansion

The Dresden site of chip contract manufacturer Globalfoundries is clearing the final hurdle for funding its own expansion. The EU Commission is approving a state subsidy of 495 million euros. With expected costs of 1.1 billion euros, this corresponds to a funding rate of 45 percent. The funding is part of the European Chips Act, with which the EU aims to strengthen domestic semiconductor production.

The approval from the EU Commission has been considered a formality for months. Globalfoundries has already begun expansion at its own expense under a so-called construction permit that does not jeopardize funding. The expanded production could start as early as 2027; by the end of 2028, the expansion is expected to reach its full production capacity.

Globalfoundries speaks of an additional 5000 square meters of cleanroom and laboratory space. The annual manufacturing capacity is set to increase from around 950,000 to 1.1 million exposed silicon wafers.

The chip contract manufacturer, also known as a foundry, specializes in microcontrollers with integrated memory, analog circuits, and high-frequency technology. The manufacturer's most important manufacturing process is called 22FDX: a 22-nanometer class process with so-called Fully Depleted Silicon-on-Insulator (FD-SOI)[Link to article 1548320]. The chips are usually tiny, so thousands can fit on a single wafer. With a capacity of over a million wafers per year, it quickly amounts to billions of chips.

Funding for sensor manufacturer X-Fab

Meanwhile, X-Fab is receiving 128 million euros for the expansion of a semiconductor factory in Erfurt. This involves Micro-Electro-Mechanical Systems (MEMS), primarily sensors with older manufacturing technology. Production is scheduled to start in 2029.

The funding is also being provided because X-Fab is to combine MEMS with novel packaging techniques that do not yet exist in Europe. Local companies without their own semiconductor factories would thus have a stronger alternative to Asian chip contract manufacturers.

In return for the funding, Globalfoundries Dresden and X-Fab are committing, among other things, to prioritize EU orders in times of crisis. Furthermore, educational and training measures are to promote young engineers. Both companies supply, among others, German car manufacturers.

(mma)