Nexperia invests in European semiconductor capacity

: Metals
21/06/17

Dutch semiconductor firm Nexperia is investing $700mn over the next 12-15 months to expand its manufacturing capacity in Europe and Asia.

Nexperia will increase the capacity at its semiconductor wafer fabrication plant in Germany by 20pc from 35,000 wafers/month — which is equivalent to 70bn semiconductors annually — from mid-2022. Capacity at its UK fabrication facility will increase by 10pc from 24,000 wafers/month.

The company will expand its research and development activities, including new laboratories across all of its sites, to develop its gallium nitride (GaN) wide bandgap semiconductors and power management integrated circuits. It will also expand its assembly factories in Asia-Pacific.

Demand for semiconductors from the electronics and automotive industries has rebounded sharply since the start of the Covid-19 pandemic, while suppliers have struggled to keep pace.

Nexperia reported sales of $1.4 billion in 2020, with demand rising rapidly in the third and fourth quarters. The growth has been maintained so far this year and the company expects it to continue over the long term.

The investments are in line with the company's strategy to expand internationally and increase market share, set out before the pandemic. The ramp-up in capacity will help it to meet growing demand. Last month Nexperia announced the launch of new silicon-based metal–oxide–semiconductor field-effect transistors (MOSFETs) from a new production line in the UK.

Other semiconductor manufacturers are also investing in new capacity in Europe and launching new devices for automotive applications to ease the global shortage in semiconductor supply.

EU member states issued a joint declaration last week to co-operate to strengthen Europe's semiconductor manufacturing capacity and processor supply chain. The initiative will increase investment in the sector through the €672.5bn ($801.25bn) EU Recovery and Resilience Fund. The European Commission aims to double Europe's share of global semiconductor production to 20pc by 2030. The new investments will add capacity beyond existing projects that are starting to come on line.

Switzerland-based STMicroelectronics has completed the central part of a new semiconductor manufacturing plant in Italy that is planned to start production next year. The company has started delivering its new automotive microcontrollers (MCUs) for advanced vehicle electronics.

German appliances manufacturer Bosch last week opened a new wafer fabrication facility in Germany. The €1bn plant is the largest investment the company has made in its 130-year history. It will start producing chips for power tools in July, six months earlier than scheduled, and start producing automotive semiconductors in September, three months earlier than planned.

By Nicole Willing

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