Infineon to Build Europe's First High-Volume GaN Semiconductor Plant in Austria

Infineon Technologies AG plans to establish the world’s first high-volume 300-millimeter gallium nitride (GaN) power semiconductor facility in Europe, located in Villach, Austria. The company stated that this site will be dedicated to mass production of GaN power semiconductors on 300-millimeter wafers.

According to Infineon, the project represents a total investment of €1.1 billion, with spending scheduled to continue through 2034. The company indicated that this facility is intended to support the growing demand for efficient power electronics in various industrial and consumer applications.

Manufacturing Scale and Technology

The shift to 300-millimeter wafers is central to the facility’s capacity. According to Infineon, these larger substrates yield 2.3 times as many chips as the 200-millimeter wafers previously used in the sector. This efficiency gain allows the plant to output significantly more power semiconductors per wafer.

The new campus will join an existing industrial ecosystem in Villach. The location currently hosts the Infineon Austria Villach site, which employs 4,800 people. This site is part of the broader Infineon Austria operation, which counts a total of 5,800 employees.

Production at the facility is scheduled to begin by the end of 2027.

State Support and Funding

• European Commission approved €319 million in state aid under the European Chips Act.
• Formal funding commitment from the Austrian Federal Ministry for Economic Affairs, Energy and Tourism is pending.

The European Commission has granted initial regulatory clearance, authorizing €319 million in state aid pursuant to the European Chips Act.

Despite this approval, definitive financial support from the Austrian government has not yet been secured. The Austrian Federal Ministry for Economic Affairs, Energy and Tourism has not issued a formal funding commitment, and no schedule has been established for when this authorization will be concluded.

Market Outlook and Executive Statements

Forecasts indicate the GaN power semiconductor sector is set to hit USD 3.5 billion by 2031, expanding at a 35 percent annual pace from 2025 through 2031.

Infineon CEO Jochen Hanebeck remarked, "This substantial investment shows our clear commitment to strengthening the European semiconductor ecosystem..." Austrian Federal Chancellor Christian Stocker noted, "With Infineon's billion-euro investment, we are witnessing one of the largest single investments..." Meanwhile, Infineon Austria CEO Sabine Herlitschka observed, Competitiveness and technological sovereignty emerge where excellent research is translated into industrial value creation.

Regulatory Context and Workforce Integration

The European Commission’s approval of the €319 million state aid package is intended to generate spillover effects across related sectors, specifically through cross-border collaboration with universities and research institutions. The Commission also noted improved access to innovative technologies for start-ups and small and medium-sized enterprises as a benefit of the expansion.

Infineon Austria CEO Sabine Herlitschka emphasized that the project translates research into industrial value creation, securing highly skilled jobs and strengthening the local microelectronics ecosystem. The investment is framed by Austrian Federal Chancellor Christian Stocker as ensuring the future of the semiconductor industry is shaped in Austria and Europe, not solely in Asia or the United States.

What to watch

The immediate next step is the formal funding commitment from the Austrian Federal Ministry for Economic Affairs, Energy and Tourism, which remains pending.