Infineon to invest €2 billion in Kulim frontend fab

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Infineon Technologies is to add significant manufacturing capacities in the field of wide bandgap (SiC and GaN) semiconductors.

The company has announced that it is investing more than €2 billion to build a third module at its site in Kulim, Malaysia. Once fully equipped, the module will generate €2 billion in additional annual revenue with products based on silicon carbide and gallium nitride.

The expansion, following the company’s long-term manufacturing strategy, will benefit from the economies of scale that are already being achieved for 200-millimeter manufacturing in Kulim. It will complement Infineon’s 300-millimeter manufacturing capabilities in Villach and Dresden.

“Innovative technologies and the use of green electrical energy are key in reducing carbon emissions. Renewable energies and electro-mobility are major drivers for a strong and sustainable rise in power semiconductor demand,” said Jochen Hanebeck, Chief Operations Officer at Infineon. “The expansion of our SiC and GaN capacity is readying Infineon for the acceleration of wide bandgap markets.”

Infineon already provides SiC-based products to more than 3,000 customers delivering better system performance in terms of efficiency, size and cost compared to silicon-based solutions.

Infineon is targeting a broad range of applications such as industrial power supply, photovoltaic, transportation, drives, automotive and EV charging and is forecasting revenues of $1 billion from SiC-based power semiconductors by the middle of the decade.

The GaN market is also predicted to undergo massive growth, from $47 million in 2020 to $801 million in 2025, according to Yole, and Infineon has established a broad GaN IP portfolio and large R&D force.

Construction of Kulim 3 will begin in June and the fab will be ready for equipment in summer 2024. The first wafers will leave the fab in the second half of 2024. The investment in Kulim will comprise significant value-added steps, in particular epitaxial processes and wafer singulation.

“Malaysia is one of Infineon’s main regional hubs and this further investment truly attests to our conducive ecosystem and the capability of our local talent to support long-term growth”, said Malaysia’s Senior Minister and Minister of International Trade and Industry, Dato’ Seri Mohamed Azmin Ali. “The Government, through Malaysian Investment Development Authority (MIDA), will continue working closely with our strategic investors to solidify Malaysia’s prominence as a key semiconductor hub in the region.”

Infineon’s Villach site will continue to serve as the innovation base and global competence centre for wide bandgap technology by converting existing silicon facilities over the next years. 6” and 8” silicon lines will be converted to SiC and GaN manufacturing by repurposing non-specific silicon equipment.

The Villach site is currently preparing for further growth opportunities.