Sunday, November 28

Infineon benefits from lack of chips

Nikolai Setzer made it clear again on Wednesday how serious the situation is now. The CEO of Continental, one of the largest automotive suppliers in the world, complained about the significant effects on business from the current shortage of chips and rising raw material prices. Unfortunately, there is no rapid improvement in sight. The semiconductor bottleneck will continue throughout 2022. Continental is not alone in this: Almost all car manufacturers worldwide and many other industries suffer considerably and have to temporarily suspend production. The chip shortage has now become a real crisis and threatens the global economic upswing.

Those who benefit from this include the Munich-based chip manufacturer Infineon. After a record quarter, CEO Reinhard Ploss has now announced good figures for the 2021 financial year, with sales and profits increasing significantly. “We are more powerful than ever,” said Ploss. In view of the persistently high demand for semiconductors worldwide for the energy-efficient and connected world, he also expects a strong fiscal year 2022 (which runs from October to the end of September). Sales should rise to 12.7 billion euros, the profit margin should be 21 percent and investments should increase significantly.

Infineon has opened a new factory in Villach

In September Infineon opened a new plant in Villach, Austria, which is now going into operation at exactly the right time. Because Ploss also said: “Without capacity restrictions, even greater growth would have been possible.” That means: the demand is significantly higher than the supply. “We are always thinking about a new factory,” said Production Director Jochen Hanebeck. The existing Infineon locations in Villach, Dresden or Kulim in Malaysia could be considered for this.

Infineon, which emerged as a spin-off from the Siemens Group more than 20 years ago, is now one of the ten largest semiconductor groups in the world and is the only one in Europe. All other competitors are based in the USA or Asia. Infineon is the largest chip supplier for the automotive industry. Ploss does not expect quick relaxation either. Demand will remain high over the long term. Many applications would be further electrified and digitized. The shortage of chips in the automotive, industrial, data center, Internet of Things and other areas will therefore persist well into 2022. “Demand continues to outstrip supply. There is a lot of catching up to do. But the order backlog is no longer growing as strongly,” said Ploss.

Intel wants to build a “fab” in Europe – where is still open

There is increasing demand in all areas, including high-performance chips such as those used as main processors in computers or cell phones – Infineon is not active here. Europe is almost completely dependent on a few suppliers from abroad, especially from Taiwan and South Korea. The market volume for chips in Europe will rise to around 80 billion euros by 2030, predicts a study by the consulting firm Kearney on behalf of the chip manufacturer Intel. 43 percent of them should therefore be high-performance chips. In 2020, the order volume was only 44 billion euros, of which only 19 percent were high-performance chips.

In Taiwan and China in particular, companies received many discounts, for example on taxes and duties or when purchasing land. If Europe wants to reduce its dependency, the costs for companies would have to be reduced with similar measures. Intel manager Greg Slater, who is responsible for regulatory issues at Intel worldwide, is also hoping for this. The conditions in Europe are actually excellent. That’s why Intel wants to invest there and build a production facility for high-performance chips. There is excellent basic research, many technically oriented students. Only the operation of production facilities, the so-called Fabs, is just more expensive here than anywhere else in the world. It has not yet been decided where in Europe Intel’s location will be, says Slater, “but the list is getting shorter.”

Europe shouldn’t wait too long, the Kearney study warns: “The clock is ticking.” Even if one now Fab If it were decided that it would take three to five years to build, said Intel manager Slater. Kearney study author Aurik: “If we don’t act now, we’ll be back here in ten years talking about the same problem.”

Leave a Reply

Your email address will not be published. Required fields are marked *