Boost for semiconductor production in Austria

Business news |
By Nick Flaherty

The Austrian subsidiaries of Infineon, NXP and AT&S have been allowed to join an existing Important Project of Common European Interest (IPCEI) in microelectronics approved by the Commission in 2018. 

The public funding is expected to unlock and additional €530m ($620m) of additional investment from the companies.

Another IPCEI is under consideration (see Germany ready to help Europe invest ‘billions’ in chip manufacturing).

Executive vice-president of the European Commission Margrethe Vestager, in charge of competition policy, said: “The IPCEI’s integration is very important for its success – we have approved additional support by Austria to three projects because they meet the high bar of adding significant value to the existing IPCEI, with important collaborations with the existing participants.”

The first microelectronics IPCEI set up in 2018 was originally between France, Germany, Italy and the United Kingdom and allowed public support amounting to €1.75 billion (about US$2bn).

The IPCEI allows state-aid to go further than just supporting R&D but also to support initial manufacturing and is considered by Europe as a way to allow state subsidy for companies without breaking World Trade Organization (WTO) agreements.

The microelectronics IPCEI has the goal of developing innovative microelectronics technologies and components for automotive, Internet of Things (IoT) and other applications such as space, avionics, and security and their first industrial deployment. The IPCEI originally involved 27 companies and two research organisations.

Austria applied to join the IPCEI in December 2020 saying that three companies would use funds to focus on the areas of energy efficient power semiconductors, advanced security and interconnections, as well as on organic packaging technology.

The European Commission assessed that the projects involve technological and financial risk and that tax payer money is needed to provide an incentive to the companies to invest in the projects.

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