Nexperia Funnels USD 200 Million in European Expansion By CIOTechOutlook Team

Nexperia Funnels USD 200 Million in European Expansion

CIOTechOutlook Team | Thursday, 27 June 2024, 11:32 IST

Nexperia, one of the biggest producers of basic semiconductors like transistors and diodes, announced that it would fund $200 million to increase production capacity at its Hamburg, Germany, headquarters. Under the EU's Chips Act, which was launched in 2023, the investment made by Dutch-based Nexperia and owned by Chinese electronics manufacturer WingTech is a rare example of a computer chip investment made in Europe without the assistance of state subsidies.

It also comes as the European Union is considering whether China is unfairly subsidising domestic Chinese production of "legacy" chips, found in cars and household appliances, such as those made in Europe by Nexperia. Electric cars, "green energy and digitalization are inconceivable without our products," CFO Stefan Tilger said in a statement announcing the investment decision. "They are the nuts and bolts that make new technologies possible."

With production in Europe, assembly and packaging in China, Indonesia, and the Philippines, and production in Europe, Nexperia produces 100 billion of these chips annually, or nearly a quarter of the global supply. However, Nexperia, headquartered in Nijmegen, Netherlands, has come under increasing scrutiny from European governments ever since WingTech acquired it for $3.6 billion in 2018.

The British government forced it to divest a manufacturing plant in Newport in 2022, refering to security concerns. It was disqualified from receiving a subsidy to develop a battery efficiency technology in 2023 by the German government. In addition, after retroactive screening, the acquisition of the startup Nowi by the Dutch government was approved.