EU Commission approves €450M Czech state aid for Onsemi SiC power-semiconductor fab in Rožnov pod Radhoštěm

Mechanism

The Commission's decision authorises Czechia to provide a direct grant of approximately €450 million to Onsemi (NASDAQ: ON) under Article 107(3)(c) TFEU, applying the 2022 Communication amending the State aid framework for research, development and innovation in conjunction with the EU Chips Act's "first-of-a-kind" facility category. The grant covers up to ~27% of the €1.64 billion total project cost — Onsemi finances the remainder through corporate balance sheet and equipment financing.

The supported facility expands Onsemi's existing Rožnov pod Radhoštěm site — historically the company's centre of mass for SiC R&D and 6-inch production — to add an end-to-end 8-inch SiC integrated manufacturing line. The line covers the full vertical stack:

• Front-end: SiC boule (crystal) growth — the bottleneck step, currently

dominated by US (Wolfspeed, Coherent) and Japanese (Resonac, Showa Denko) suppliers.

• Mid-end: 8-inch SiC wafer processing — Europe's first at scale.
• Back-end: SiC power MOSFET / diode device fabrication.

This makes the facility the first fully integrated 8-inch SiC line on EU soil. STMicro/Soitec (Catania, Italy) and Infineon (Villach, Austria; Dresden, Germany) have or are building 8-inch SiC capacity, but rely on imported boules or run separate front-end and back-end sites.

Commercial qualification output is targeted for 2027, with full ramp expected by 2028-2029.

Downstream implications

• EV / charging-station supply: SiC power devices are the dominant

semiconductor cost element in 800V EV traction inverters and DC fast-charging. EU-sited 8-inch SiC capacity reduces dependency on US (Wolfspeed, onsemi-Hudson) and Asian (ROHM, Mitsubishi) lines for European OEMs (VW, BMW, Stellantis, Renault, Volvo) and tier-1 suppliers (Bosch, Vitesco, Valeo).

• Chips Act enforcement signal: This is the largest Chips-Act-era

state-aid approval for a Member State outside the Big-Four (DE, FR, IT, ES) and specifically validates Czechia's October-2024 National Semiconductor Strategy as a credible vehicle for attracting Chips-Act investment. Comparable approvals (TSMC Dresden ESMC, Intel Magdeburg [later cancelled], STMicro/Soitec Catania, Infineon Dresden Smart Power) cluster in the Big-Four; this is the first major EE-region approval.

• Wolfspeed / Coherent competitive impact: As a fully integrated

EU-domiciled 8-inch SiC line, the Onsemi Rožnov facility is positioned to compete directly with US-domiciled SiC boule suppliers for European customer share once qualified. Pre-existing Onsemi Hudson NY 8-inch SiC capacity gives the company global SiC redundancy unmatched by Wolfspeed (Mohawk Valley NY) or Coherent (Easton PA).

• Czech Semiconductor Cluster: Embeds a flagship Tier-1 anchor inside

the cluster framework launched by the 2024 Czech National Semiconductor Strategy, supporting downstream packaging/assembly buildouts and adjacent Onsemi supplier on-shoring.

Open questions

• Final SiC wafer output target (kWPM at 8-inch equivalent) — the Commission

press release does not disclose the project's nameplate capacity figure.

• Whether the grant draws from the EU Chips Act / Important Project of Common

European Interest (IPCEI) Microelectronics co-financing envelope or is Czech-Republic-funded entirely under national budget authority with EU state-aid clearance only.

• Conditional clawback / production-target clauses negotiated by the

Commission as part of the approval — typical in Chips-Act state-aid cases but not disclosed in the press release.