France may subsidize the construction of STMicro and GlobalFoundries factory from the EU

STMicro and GlobalFoundries may receive a subsidy from the French government for the construction of a chip factory. France is allocating 7.4 billion euros for this. The two companies want to run at full capacity in 2027 and then produce 620,000 300mm wafers annually.

The European Commission approves the French plans. The construction coincides with the objectives that Europe wants to achieve with the Chips Act. This law makes state aid possible for chip manufacturers, so that Europe becomes less dependent on foreign parties. STMicro and GlobalFoundries announced last year that they are jointly building a chip factory near Lyon. The French government initially wanted to contribute 5.7 billion euros, but later said it wanted to allocate more money because of the Chips Act.

That new amount will be 7.4 billion euros, which the French government will now give to the company in the form of subsidies. To this end, there will be a chip factory that must be fully up to scratch by 2027. That is a year later than originally planned. With the approval of the European Commission, the factory must give European companies priority in purchasing the products and medium and small companies must have access to test and development areas in the factory to conduct their own research and development.

The factory must annually produce 620,000 wafers with a diameter of 300mm. These are mainly intended for the automotive and aviation industries and for the roll-out of 5G and 6G networks. These are chips with so-called fully depleted silicon on insulator, or fd-soi, technology that are mainly intended for lower energy consumption.