Infineon: Construction of the world’s largest 200-millimeter “SiC Power Fab” in Kulim, Malaysia

August 3, 2023. The trend towards decarbonization will lead to a strongly growing market for power semiconductors, especially in the area of compound semiconductors. As a leading company in the field of Power Systems, Infineon Technologies AG is now taking a further, decisive step to develop this market: By significantly expanding manufacturing in Kulim – beyond the investment originally announced in February 2022 – the company will build the world’s largest 200-millimeter “SiC (silicon carbide) Power Fab.” The planned expansion is supported by customer commitments of around five billion euros for new design wins in the automotive and industrial sectors and upfront payments of around one billion euros.

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Rendering of Infineon Technologies AG's manufacturing site in Kulim, Malaysia: the significant expansion - beyond the investment originally announced in February 2022 - will see the company build the world's largest 200-millimeter "SiC Power Fab." Photo: Infineon

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Infineon will invest up to an additional five billion euros in Kulim over the next five years in a second phase of module three construction. Together with the planned 200-millimeter SiC conversion of the Villach (Austria) and Kulim plants, this investment will result in annual SiC sales potential of around seven billion euros by the end of the decade. The highly competitive manufacturing base will help Infineon achieve a SiC market share of 30 percent by the end of the decade. Infineon is confident that the company’s SiC sales will exceed the target of one billion euros in the 2025 fiscal year.

“The market for silicon carbide is growing faster and faster, not only in the automotive industry, but also in a wide range of industrial applications such as solar, energy storage and high-performance charging of electric vehicles. With the expansion of Kulim, we are securing our leadership position in this market,” said Jochen Hanebeck, CEO of Infineon. “With industry-leading scale and a unique cost position, we are bringing our competitive position to bear with best-in-class SiC trench technology, the broadest package portfolio and unmatched application expertise. These factors are where we differentiate and succeed in the industry.”

Infineon has received new product decisions from customers (design wins) worth approximately five billion euros, along with upfront payments of approximately one billion euros from existing and new customers: In the automotive sector, these include six OEMs, three of them from China. Among the customers are Ford, SAIC and Chery. In the renewable energy sector, customers include SolarEdge and three leading Chinese companies in the fields of photovoltaics as well as energy storage systems (ESS). In addition, Infineon and Schneider Electric have agreed on a capacity reservation including upfront payments for power products based on silicon and SiC. Infineon and the respective customers will provide more details in separate announcements in the near future. The upfront payments will contribute positively to Infineon’s cash flow in the coming years and are expected to be fully repaid by 2030 at the latest in conjunction with the agreed sales volumes.

Dato’ Seri Anwar bin Ibrahim, Prime Minister of Malaysia, acknowledged Infineon’s commitment to building a major wide bandgap hub in the country. “Malaysia is making the greatest efforts to achieve the national goal of decarbonizing the economy and becoming net carbon neutral by 2050. Malaysia’s continued attractiveness as an investment destination goes hand in hand with a well-established environment for the development of innovative and sustainable technologies. In this sense, Malaysia is home for Infineon, with its vision of green technology and sustainability. That Infineon and other established German companies are betting on Malaysia is a vote of confidence in Malaysia’s new economic growth agenda. It is based on inclusion and sustainability, and enabled by strong policies in the areas of knowledge transfer, quality investment, business support, and socio-economic well-being based on equitable wealth distribution.”

The Minister of Investment, Trade and Industry (MITI), Tengku Datuk Seri Utama Zafrul Aziz, acknowledged Infineon’s investment project, saying, “Infineon’s expansion of the world-class silicon carbide fab in Kulim is an important milestone in Malaysia’s drive to develop advanced manufacturing capabilities, create high-skilled jobs, and position the country at the forefront of green technologies critical to achieving our global sustainable development goals. The innovative power semiconductor technologies manufactured at the ‘SiC Power Fab’ will also strengthen Malaysia’s position as a key player in the global semiconductor ecosystem, playing a growing role in the supply chain for sustainable technologies in particular. I am pleased that Infineon shares Malaysia’s commitment to combating the effects of climate change, and I look forward to our long-term partnership for the further development of the green technology ecosystem in Malaysia.”

Sustainability is a key element in the design, construction and operation of the Kulim fab. The building is designed for responsible use of resources such as power and water.

About Infineon

Infineon Technologies AG is a leading global provider of semiconductor solutions for power systems and the Internet of Things (IoT). With its products and solutions, Infineon is driving decarbonization and digitalization. The company has around 56,200 employees worldwide and generated sales of around 14.2 billion euros in the 2022 fiscal year (ending September).

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Further links

👉 www.infineon.com 

Photo: Infineon