ItInsightsWorld: €1.1bn Infineon Move Brings 300mm GaN Output Closer for Europe

Austria’s semiconductor manufacturing map is being redrawn by a new GaN bet: Infineon has set aside around €1.1 billion for Villach, where it says the first high-volume production of gallium nitride power semiconductors on 300mm wafers will be located. Manufacturing is expected by the end of 2027, and the spending period runs through 2034.

For engineers building AI data centers, electric vehicles and industrial systems, the issue is whether larger wafers can make GaN adoption easier by improving manufacturing economics.

From wafer-size progress to volume capacity

The planned build uses existing cleanroom capacity in Villach, pairing expansion with established operations rather than starting from a clean sheet. That reduces the distance between process development and factory output.

The first 300mm GaN wafer processing at Infineon took place in 2024, giving a practical demonstration that the platform can deliver approximately 2.3 times as many chips per wafer as conventional 200mm manufacturing.

Relative to silicon-based power devices, GaN can switch faster, lose less power and generate less heat, which supports smaller and more efficient conversion stages.

Public backing and the European site footprint

Under the European Chips Act, the European Commission has approved €319 million in state aid. Formal funding approval from Austria’s Federal Ministry for Economic Affairs, Energy and Tourism is still pending.

Infineon Technologies presents the move as support for manufacturing capacity in Europe and for cooperation with universities, research organizations and smaller technology companies. Villach already anchors power semiconductor research and production for Infineon, with around 4,800 people at the site and approximately 5,800 employees across Austria.

“This substantial investment shows our clear commitment to strengthening the European semiconductor ecosystem and Europe’s technological sovereignty. By establishing high-volume manufacturing on 300-millimeter wafers, we will be the first company in the world to bring gallium nitride power electronics into volume production,” said Jochen Hanebeck, CEO of Infineon Technologies AG.

Market signals behind the GaN ramp

Yole Group’s Power GaN 2026 report points to a global GaN power semiconductor market that could reach approximately $3.5 billion by 2031, expanding at around 35% annually between 2025 and 2031.

That sizing frame sits behind rising use in AI infrastructure, energy systems, e-mobility and robotics, where efficient conversion is becoming more important.

What the Villach timeline changes

The project turns a wafer-size argument into a supply question: can volume GaN on 300mm wafers arrive at the pace needed by power-electronics designers? If the schedule holds, the same Austrian base that already carries large manufacturing employment becomes a route for Europe to scale a technology beyond niche use.