Globalfoundries is planning a mega expansion in Dresden: 1.1 billion euros for chips!

Globalfoundries is planning a mega expansion in Dresden: 1.1 billion euros for chips!

A lot is currently happening in the world of semiconductors in Dresden. Globalfoundries, a major US chip producer, has negotiated with the German government for funding for its site. An impressive expansion of the factory in Saxony is planned, which is expected to cost 1.1 billion euros. A few days ago it was announced that the federal government was prepared to provide several hundred million euros in grants to support this ambitious plan. The goal? Production in Dresden is to be doubled to up to 1.5 million wafers per year. This decision could turn out to be the right one, as Globalfoundries is an important supplier to the automotive industry, which is currently affected by a dramatic chip shortage.

A spokesman for the company stated that the implementation of the European Chips Act has already begun in Dresden. The details of the planned projects are to be published in the coming weeks. Oliver Schenk, MEP for the CDU, confirmed that the government had approved the start of the project, even if the final funding approval was still pending. Nevertheless, Globalfoundries can already start purchasing machines for production.

A strong ecosystem: Silicon Saxony

Dresden itself is often referred to as “Silicon Saxony”. This name is no coincidence, as Saxony is home to the largest semiconductor industry in Europe, which is largely due to the legacy of the GDR, extensive research and numerous subsidies. The semiconductor ecosystem in Saxony has an impressive 73,000 employees working in manufacturers, suppliers, service providers and research institutes. In addition to Globalfoundries, the large companies in this region also include Bosch and Infineon. The semiconductor tradition in Dresden, which dates back to the GDR era, has reached a new dimension today.

The Technical University of Dresden and numerous research institutions play a central role in further driving innovation and growth in the industry. It is particularly worth mentioning that Bosch only opened a new semiconductor factory in Dresden in 2021, which is equipped with an investment of 1 billion euros and is also planning expansion measures in the near future.

Subsidies and European cooperation

The dizzying investments in the semiconductor industry are not without reason. The chip shortage, triggered by various factors, including the corona pandemic, has brought the automotive industry in Germany into serious difficulties. To meet this challenge, the EU initiated the European Chips Act in spring 2022 with the aim of improving the EU's self-sufficiency in the microelectronics sector. Funding of 20 billion euros is planned for Germany, of which 3 billion euros are still available for future projects. These measures not only strengthen Saxony as a location, but also send an important signal to other EU member states that this global competition can be successfully faced.

Globalfoundries' investment is seen as a real milestone for high technology in Saxony, especially after the failed establishment of Intel in Magdeburg. This development could bring hope for economic recovery in the region, especially in the automotive and chemical industries, which are of central importance for the Saxon economy.

It remains exciting to see how the plans will materialize. However, the omens are good for Dresden and the entire Silicon Saxony, which wants to continue to position itself as a hot spot for the semiconductor industry in Europe.

For more information on the latest developments in this area, read reports from South German newspaper, NZZ and Silicon Saxony.