Malaysia ‘going up’ the chip ladder as Infineon opens US$7.7 billion plant

Anwar highlighted the need for the local government and universities to help train the necessary talent to better accommodate Kuala Lumpur’s efforts to bulk up the local chip industry. This comes as major governments around the world are spending tens of billions to bolster the domestic production of semiconductors, a commodity that is regarded as one of the most strategic goods for countries to develop emerging technologies.

Infineon Chief Executive Officer Jochen Hanebeck said that the new Kulim campus progressed ahead of its original schedule and it will become the world’s largest silicon carbide power semiconductor manufacturing site once the second phase is also completed.

The new plant will focus on making power semiconductors that can help with decarbonisation in automotive, industrial and data centre fields. It is expected to create a total of 4,000 jobs eventually, according to Infineon.

Infineon’s investments in Malaysia highlight the Southeast Asian nation’s potential to attract more tech investments at a time when major chip firms are seeking alternatives to mainland China and Taiwan for manufacturing given increasing geopolitical uncertainties.

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World’s largest contract chip maker TSMC inaugurates its first plant in Japan

Malaysia has in past years emerged as a global hub for packaging and assembling, the final process before chips are ready for use in smartphones, data centres and electric vehicles. Major players including Intel Corp., ASE Technology Holding Co. and Amkor Technology Inc. have taken advantage of its skilled and lower-cost labour and proximity to major markets, especially as Covid and US-Chinese tensions disrupted the flow of chips globally.

In recent years however, China – eyeing packaging as