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Infineon is considering transferring more chip production capacity to the United States

Update time : 2023-06-19 09:28:28

According to reports, Infineon, the world's largest supplier of automotive silicon carbide chips, has stated that it is considering transferring more production capacity to the United States to better comply with the recently passed legislation aimed at boosting the US semiconductor industry. Last year, Infineon generated 11% of its revenue from the United States and 29% from Chinese Mainland.
Peter Wawer, head of Infineon's environmental protection technology department, said that the company was reviewing the requirements of the Inflation Reduction Act related to the value of goods made in Made in USA. We need to ensure that we comply with these rules and requirements, "Wawer said." We don't want to be excluded from critical business because we don't have a certain value share in the United States
At present, Infineon has seven manufacturing bases in the United States and one in Mexico, which is largely due to the company's acquisitions in the past 10 years, such as the acquisition of International Rectifier in 2015 with $3 billion, and the acquisition of competitor Cypress Semiconductor in 2019 with $9 billion. Wawer revealed that Infineon is currently satisfied with its production footprint in the United States, but in the future, the company "may need to transfer a certain amount of products or production capacity to the United States".
45% of Infineon's sales come from the automotive industry. Although car sales are slowing down, Infineon believes that the company will benefit from the industry's transition to electric vehicles, as electric vehicles require more chips than internal combustion engines.
Amit Harchandani, head of European technology research at Citigroup, stated that Infineon's power chips make it a "major beneficiary of the transition to renewable energy". He said, "I expect any company that can benefit from the energy transition to evaluate the incentives in the US Inflation Reduction Act.
In 2022, Infineon's sales reached 14.2 billion euros, with Wawer's environmental technology department contributing 13% of the sales. However, Wawer stated that the increase in green energy infrastructure such as wind turbines, solar panels, electric vehicle chargers, and transmission lines required to connect all equipment to the grid means that the demand for chips will "explode". Wawer revealed that the department expects its annual revenue growth to exceed 10% in the coming years.

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