Infineon to invest €1.1bn in Villach plant for next-generation gallium nitride chips

Infineon Technologies will spend €1.1 billion building a new production facility at its Villach plant in the Austrian state of Carinthia, the company announced, targeting gallium nitride power semiconductors it says no manufacturer currently produces at high volume.

Chief executive Jochen Hanebeck said the new 300-millimetre wafer line — up from the current 200-millimetre format — would yield 2.3 times as many chips per wafer and serve markets including artificial intelligence infrastructure, electric mobility and robotics. Infineon estimates the global GaN chip market will reach €3.5 billion by 2031, six times its current size.

Austrian Chancellor Christian Stocker confirmed that Infineon will receive €319 million in state aid under the European Chips Act. Stocker said each Infineon job supports close to three further positions in Austria; the company currently employs around 5,800 people at the Villach site.

Hanebeck said staff expertise and a reliable political environment were decisive factors in choosing Villach. Production is scheduled to begin by the end of next year, with investment running through to 2034. Infineon expects the new facility to contribute €1.5 billion annually to group revenue once operational.

The Villach expansion follows Infineon's opening of a new Dresden plant in July and forms part of a broader European push to reduce dependence on Asian chip supply.