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Germany’s Largest Semiconductor Producer to Build Factory in Wuxi

| Oct 13, 2015 08:27 AM EDT

Infineon, Germany's largest semiconductor producer, is planning to build a second factory in Wuxi in Jiangsu Province.

Infineon Technologies AG, Germany's largest and Europe's second-largest semiconductor producer, has bared plans to build a second factory worth $300 million in Wuxi, Jiangsu Province, in a bid to raise its smart manufacturing capability in China, the China Daily reported.

Reinhard Ploss, Infineon's chief executive officer, said that the facility could create around 2,500 jobs when production goes into full operation, as the country's "Made in China 2025" strategy would provide the firm with more design and manufacturing opportunities.

The report said that the facility, which covers an area of 36,000 square meters, is expected to be completed by the end of 2016.

"In the 2014 fiscal year, China accounted for 20 percent of Infineon's total revenue, which made it its most important sales market, even ahead of Germany," Ploss said. "The new factory highlights our confidence in the continuous opportunities of the Chinese market as well as our commitment to substantial investment in China."

Infineon products are widely used in bank cards and passports in China, and Ploss said that the country has consumed nearly half the world's semiconductor and continues to grow.

"But there is a clear move away from just usage of semiconductors, to their local design and manufacturing, and we believe the Internet of Things will be one of the next growth areas," Ploss added.

The Internet of Things has been seen as the stimulus for China's economic growth; the technology is expected to be used and applied in smart homes, grids, mobility and factories, the report said.

In 1995, Infineon launched its first branch in Wuxi, which now employs more than 1,800 Chinese workers. Its factories develop, design, manufacture and assemble an extensive array of electronic components and other products that are widely used in industrial, automotive, power management and security-card applications.

Ploss said that the industry in China is developing and their goal is to build their reputation as a truly Chinese company.

"We want to be acknowledged as a Chinese citizen that makes its Chinese customers successful, and are making a substantial investment for a joint future success, cooperating with more local partners," said Ploss.

Aside from investing in manufacturing in Wuxi, Ploss added that the company would invest in research and development as "competition on a global basis is not just about manufacturing, it is about knowledge, and we have to create more knowledge locally."

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