EU approves German state aid to support chip factories

The European Commission has approved €623 million in German state aid to support the establishment of two new semiconductor manufacturing facilities in Germany. The funding consists of two grants: €495 million awarded to GlobalFoundries, a semiconductor foundry that manufactures chips exclusively for other companies, and €128 million granted to X-FAB to support the construction of a new open foundry at its existing site in Erfurt. According to the Commission, these projects represent first-of-a-kind semiconductor facilities in Europe and are expected to boost economic development. The measures are also intended to strengthen the European semiconductor ecosystem by increasing production capacity, technological capabilities, and supply chain security. Impact on German manufacturers (criteria): • Improved local chip supply • Reduced dependency on imports • Stronger industrial resilience • More innovation and capacity • Better support for automotive and industrial sectors

October 2026

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