Wolfspeed and ZF plan chip factory in Saarland for more than two billion euros

Wolfspeed and ZF plan chip factory in Saarland for more than two billion euros

Stuttgart/Munich The US corporation wolf speed builds the world’s largest plant for silicon carbide (SiC) semiconductors in Saarland. The auto parts supplier takes a stake in the factory IF with a minority stake. The Handelsblatt learned this from circles familiar with the project.

Wolfspeed decided to build on the site of a former coal-fired power plant in Ensdorf, confirmed several people familiar with the project. Series production is scheduled to begin in four years. In addition, a joint research center will be set up IF hold the majority. The two companies declined to comment on the request. The Saarland state government also kept a low profile.

According to the Handelsblatt information, Wolfspeed wants to start construction work as soon as possible. However, the commitment for state subsidies is still missing. The subsidies are the prerequisite for the commitment in Saarland. Semiconductor manufacturers generally use public funds to calculate 40 percent of the total costs.

Wolfspeed’s latest work in the USA cost around two billion dollars. According to reports, the factory in Saarland will be significantly larger and therefore more expensive.

Top jobs of the day

Find the best jobs now and
be notified by email.

The close German-American cooperation is also the first major focus of the new ZF boss Holger Klein, who has been in office since the beginning of the year. It is good news, especially for the German car industry, that Wolfspeed has decided on a factory in this country. With the plant in the immediate vicinity of their European production sites, manufacturers can hope to be supplied reliably. The North Carolina group concentrates on SiC chips like no other competitor. Silicon carbide is in demand worldwide because it could help electromobility achieve a breakthrough.

Electric vehicles last longer with SiC chips

The material is more expensive than conventional silicon, but is considered very promising. With SiC chips, electric vehicles last longer, can be charged faster and reduce operating costs thanks to lower consumption. At the same time, SiC chips are smaller and lighter. Peter Fintl, semiconductor expert at technology consulting Capgeminisays: “Just by replacing silicon with silicon carbide, the range can be increased by eight percent.”

major project


billion dollars

has cost Wolfspeed’s latest plant in the USA. According to reports, the factory in Saarland will be significantly larger and therefore more expensive.

According to industry circles, the fact that Wolfspeed chose Saarland is primarily due to its partner ZF. With more than 9,000 employees, the automotive supplier is the largest employer in the region and can provide urgently needed staff for the new factory.

ZF has had good contacts with the Saarland state government for years thanks to its largest transmission plant based in Saarbrücken. The plant is to be largely converted to electric drives. The state government is also supporting this transformation in order to preserve as many jobs as possible in Saarland.

“Many of our European customers would like to have a plant near them,” Wolfspeed boss Gregg Lowe told the Handelsblatt in November. “We’ve already looked at a dozen locations here,” including in Germany. Now the decision has apparently actually been made for Germany.

Also Bosch has entered the production of SiC chips

A deal from the fall shows how scarce silicon carbide is: The automotive supplier Borg Warner has invested half a billion dollars in Wolfspeed. Borg-Warner gets guaranteed access to SiC chips worth $650 million a year.

Many of our European customers would like to have a factory close by. We’ve already looked at a dozen locations here. Wolfspeed boss Gregg Lowe in November

Experts assume that the SiC business will pick up strongly in the second half of the decade. However, customers fear that the production capacities will not be sufficient. Therefore, they enter into long-term agreements. Albert Waas, chip expert at the Boston Consulting Group, says: “It is becoming increasingly important for companies to secure their supply chains.”

At the end of last year, the car company Stellantis the wolfspeed rival Infineon commissioned to deliver SiC chips with a total value of one billion euros from 2025. last has Mercedes Signed an undisclosed volume supply agreement with Wolfspeed earlier this year.

The investment by Wolfspeed and ZF is also a declaration of war Bosch. Was the world’s largest automotive supplier, except for its Japanese rival denso, so far the only automotive supplier that produces chips itself. The Swabians also got into the production of SiC chips.

>> Read here: Bosch boss Hartung: “We are investing against the global semiconductor supply crisis”

At the main plant in Reutlingen, an additional 400 million euros are to be invested by the end of 2025 in order to expand the clean room area from 35,000 to 44,000 square meters. The majority of the expansion in Reutlingen serves to expand the production of power semiconductors made of silicon carbide.

Employees at the ZF plant in Saarbrücken

The transmission specialist from Friedrichshafen is involved in the new chip factory.

(Photo: imago images / Becker&Bredel)

With the know-how and experience of the Americans, ZF is now picking up the pace and could even overtake Bosch in terms of fast charging and range chips from 2027. Because Bosch manages the entire technology from on-board resources. Bosch’s goal is to become the world leader in the production of SiC chips for electromobility. The ZF-Wolfspeed combination complicates this project.

CEO Gregg Lowe only has the US authorities to thank for the fact that Wolfspeed still exists. Seven years ago, the Munich Dax group wanted Infineon buy the company, the contracts were already signed. However, the American government prohibited the takeover with reference to national security.

TSMC thinks about a new factory in Dresden

It would have been a very good deal for Infineon, strategically and financially. At the time, the Munich-based company wanted to pay 850 million dollars, today Wolfspeed is worth around ten billion dollars on the stock exchange. In the third quarter, the company had revenue of $241 million, up more than 50 percent year-on-year. The bottom line, however, was a loss of $26 million.

It is becoming increasingly important for companies to secure their supply chains. Albert Waas, chip expert at the Boston Consulting Group

CEO Lowe promises sales of four billion dollars by 2027. By then, the American wants to spend around 6.5 billion dollars on additional capacities.

In addition to its own SiC chips, the group also sells silicon carbide as a raw material to other manufacturers for their components. Customers include Infineon, ST Microelectronics and Onsemi.

Settling in Saarland is important for Europe as a whole. Because the EU Commission has set the goal of doubling Europe’s share of world chip production to 20 percent by 2030. However, the USA had recently attracted significantly more investment than Europe.

The largest investment in a new chip location in the EU has so far intel announced. The US group wants to spend 17 billion euros on two factories in Magdeburg. Infineon is also investing five billion in an additional plant in Dresden.

As with Wolfspeed, the funding commitments for these projects are still pending; the start of construction depends on this. In addition, TSMC is considering a factory in Dresden. The Taiwanese are the largest contract manufacturer in the world and an important supplier for almost all leading chip companies.

More: Start of construction for Intel factories near Magdeburg delayed

Source link