US chip giant Wolfspeed speaks on expansion in Ensdorf site

By Birgit Reichert, rdp I Friday, October 25, 2024

 

BERLIN – US chip manufacturer Wolfspeed has reiterated its commitment to building a large new factory in western Germany, after announcing an indefinite delay to construction due in part to the slow take-up for electric vehicles.

The company, based in the eastern state of North Carolina, told dpa that improved productivity at its US sites, coupled with weak international demand for semiconductors, have ensured it has sufficient capacity in the short term.
As a result, Wolfspeed confirmed it is suspending plans to build the new plant in Ensdorf, in the western German state of Saarland.

The comments came after Saarland Premier Anke Rehlinger on Wednesday publicized the delay, calling it a “setback” for her state and highlighting the wider struggles of the electric vehicle market in Germany and Europe.

Wolfspeed first announced plans to build a large factory for silicon carbide semiconductor devices on the site of a former coal-fired power plant in Ensdorf in 2023.

The chips are considered central to the development of electric vehicles and autonomous driving.
German engineering giant ZF Friedrichshafen, a major automotive supplier, was due to invest €170 million ($183.5 million) in the factory.

However, with global demand for electric vehicles proving sluggish, Wolfspeed first delayed construction until 2025 before announcing the indefinite suspension.

A spokesman for ZF said on Thursday that the company “regrets” the postponement, but that it understood the decision.

“We all recognize that e-mobility is not currently developing as hoped,” he stated.
Wolfspeed meanwhile said it is “in active discussions” with the German government and authorities in Saarland, and believes the “medium to long-term outlook for silicon carbide semiconductors remains strong globally.”

“Following a clear acceleration of our customer demand and additional capacity needs, Wolfspeed envisions expansion in Europe and the Ensdorf site remains our preferred site for this expansion,” the manufacturer added.
In September US chipmaker Intel postponed the construction of a 30-billion-dollar manufacturing facility in the state of Saxony-Anhalt, with company boss Pat Gelsinger saying the project would be delayed by around two years.