Following the Federal Constitutional Court’s ruling on the supplementary budget, Frank Schäffler, the budget expert of the Free Democratic Party (FDP), is urging the abandonment of subsidies for chip factories in Magdeburg and Dresden, as well as railway investments in the billions.
“It has always been wrong to pour billions in subsidies into the establishment of chip factories,” Schäffler told the Redaktionsnetzwerk Deutschland (RND). “These subsidies should now be cut. The time for spending money recklessly is over, especially after the Constitutional Court ruling.”
Schäffler dismissed the argument for economic development in disadvantaged regions, stating, “The planned locations for the chip factories, Magdeburg and Dresden, are not economically weak areas. On the contrary, they are facing a shortage of labor.” He emphasized, “The construction of chip factories would disadvantage local medium-sized companies.”
In Dresden, the Taiwanese manufacturer TSMC plans to build a semiconductor factory, while the US-based company Intel has similar plans in Magdeburg. The German government has pledged subsidies to both, amounting to billions in taxpayer money.
However, Ralf Wintergerst, president of Bitkom, argued that it is crucial “to ensure the completion of the core projects of Germany’s digital policy.” He particularly highlighted the planned investments in chip factories in Dresden, Magdeburg, or Ensdorf, asserting that these should not be put at risk in light of the recent Federal Constitutional Court ruling on the debt brake.
What will TSMC and Intel manufacture in Germany?
The Taiwan Semiconductor Manufacturing Company (TSMC) will be the main partner and operator of the fab with a 70% stake, while Bosch, Infineon, and NXP will each hold 10%. The joint venture ESMC aims to commence construction in 2024.
Initially, the fab was expected to produce semiconductors with planar transistors in the 28- and 22-nm processes. However, TSMC announced plans to offer more advanced 16- and 12-nm processes with FinFETs in Dresden. The primary focus of the fab will be on chips for the automotive industry and IoT (Internet of Things) applications.
According to Handelsblatt, Intel intends to install “the next generation of EUV systems” from ASML. If these systems refer to those with high numerical aperture (High-NA), the fab could be equipped for the successor to the 1.8-nm process. Intel confirmed that the fab is expected to operate with “more advanced technology than initially planned.”
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