MUNICH, GERMANY – Media OutReach – August 3, 2023 – The decarbonization trend will drive strong growth in the market for power semiconductors, especially those based on wide bandgap materials. As a leader in power systems, Infineon Technologies AG (FSE: IFX / OTCQX: IFNNY) is now taking another decisive step to shape this market: by significantly expanding its Kulim plant – beyond the initial investment announced in February 2022 – Infineon will build the largest 200 millimeter SiC (silicon carbide) power plant in the world. The planned expansion is supported by customer commitments covering approximately five billion euros in new design contracts in automotive and industrial applications as well as approximately one billion euros in prepayments.
Rendering of Infineon Technologies AG’s manufacturing site in Kulim, Malaysia: By significantly expanding the fab – beyond the initial investment announced in February 2022 – Infineon will build the largest 200 millimeter SiC power plant in the world .
Over the next five years, Infineon will additionally invest up to five billion euros in Kulim in a second phase of building module three. The investment will lead to potential annual SiC revenues of approximately seven billion euros by the end of the decade, as well as the planned conversion of 200 millimeters of SiC from Villach and Kulim. This highly competitive manufacturing base will support Infineon’s SiC market share target of 30% by the end of the decade. Infineon is confident that the company’s SiC revenues for fiscal year 2025 will exceed the €1 billion target.
“The silicon carbide market is showing accelerated growth, not only in automotive, but also in a wide range of industrial applications such as solar power, energy storage and high-power electric vehicle charging. With the expansion of Kulim, we will solidify our leadership position in this market,” said Jochen Hanebeck, CEO of Infineon. “With industry-leading scale and a unique cost position, we leverage our competitive position of best-in-class SiC trenching technology, the broadest package portfolio, and an unparalleled understanding of applications. These factors are the areas of differentiation and success in the industry.”
Infineon won new design contracts worth around €5 billion as well as around €1 billion in prepayments from existing and new customers: in the automotive sector, this includes six OEMs, including three in China . Customers include Ford, SAIC and Chery. In renewable energy, customers include SolarEdge and three major Chinese photovoltaic and energy storage companies. In addition, Infineon and Schneider Electric have agreed on a capacity reservation including prepayments for silicon and silicon carbide electrical products. Infineon and respective customers will provide further details in separate announcements in the near future. The advance payments will contribute positively to Infineon’s cash flow in the years to come and will be fully reimbursed based on agreed sales volumes by 2030 at the latest.
The Right Honorable Dato’ Seri Anwar bin Ibrahim, Prime Minister of Malaysia, expressed his appreciation for Infineon’s commitment to building a major broadband hub in the country. “Malaysia is making every effort to achieve its national goal of decarbonizing its economy and reaching net zero by 2050. Malaysia’s continued appeal as a preferred investment destination comes with a well-established landscape for the development of innovative and sustainable technologies. vision on green technology and sustainability calls Malaysia home The continued confidence of Infineon and other well-established German companies in Malaysia is a vote of confidence in Malaysia’s new inclusive economic growth agenda and sustainability, made possible by strong policies on knowledge transfer, quality investments, business empowerment and socio-economic well-being on the basis of an equitable sharing of the nation’s wealth”.
The Minister of Investment, Trade and Industry (MITI), His Hon. Tengku Datuk Seri Utama Zafrul Aziz welcomed Infineon’s expansion and said, “Infineon’s expansion of its world-class silicon carbide plant in Kulim marks an important milestone in Malaysia’s pursuit of capacity development advanced manufacturing, creating high-skilled job opportunities and positioning the country at the forefront of green technologies, which are crucial to achieving our global sustainable development goals. Innovative power semiconductor technologies fabricated in the SiC Power Fab will also strengthen Malaysia’s position as a key player in the global semiconductor ecosystem, with a growing role especially in the I am encouraged by Infineon’s sharing of Malaysia’s commitment to addressing the impact of climate change and I look forward to our long-term partnership for the future development of Malaysia’s green technology ecosystem.
Sustainability is a key element in the planning, construction and operation of the fab. The building is designed to allow Infineon to make responsible use of resources such as electricity and water.
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