Overview
- Germany won formal approval from the European Commission on Tuesday, July 14 to provide €659 million in state aid for four semiconductor projects.
- The largest allocation, €353 million, will fund SME Element 3-5’s new silicon carbide wafer plant near Aachen; €214 million goes to Vishay in Itzehoe, €74.4 million to KLA in Weilburg, and €17.9 million to KETEK in Munich.
- Each project will be co-financed by federal and state budgets and must cooperate with universities and research institutes while demonstrating positive effects on the EU semiconductor value chain.
- The approval includes a profit-clawback mechanism that requires recipients to return money if production profits exceed current expectations, and companies still must obtain permits and set construction and production schedules with German authorities.
- The measure advances the EU Chips Act goal to raise Europe’s share of global chip production to 20% by 2030 and builds on earlier German support such as the €5 billion package for TSMC’s Dresden plant, with likely effects on automotive supply chains and regional jobs.