Germany is putting on the table a check for 10 billion euros, in the form of a subsidy, to attract the American semiconductor giant Intel to its territory.
Under discussion for many months, this project to set up a mega-factory was won thanks to a hell of an extension. Germany is indeed 3 billion euros more than expected, the subsidy from 6.8 billion to 9.9 billion euros.
“The Magdeburg plant should be equipped with the latest high-precision etching technologies on silicon (High-NA EUV) developed with the Dutch world champion ASML, with 400 million piece machines” mentions Les Echos.
A great victory for Pat Gelsinger
The construction of the factory, located in Magdeburg (center-east of the country), was to begin in the first half of the year. But Intel cited the issue of inflation as the reason for postponing the project so far.
It is therefore a great victory for Pat Gelsinger, the CEO of the American group, who managed to obtain more subsidies than expected. The subsidy represents almost a third of the total investment, now estimated at 30 billion euros, against 17 billion announced last year.
This project on the European side is part of the “Chips Act”, the program of the European Union which aims for Europe to reach 20% of the world market for semiconductors in 2030. It is a question of quadrupling current European production. This European plan plans to mobilize a total of 43 billion euros in public and private investment.
“A major step, both for Intel and for Europe”
As part of the Chips Act, STMicroelectronics and GlobalFoundries announced a €7.5 billion factory in Crolles, France earlier this month.
The German Minister of Economy and Climate announced that it is “the largest investment ever made by a foreign company in Germany”. Enough to justify a major effort for the German government while the 2024 budget remains difficult to balance.
Intel announced in 2022 a program of up to 80 billion euros invested in Europe over ten years.
According to Pat Gelsinger, these investments “represent a major milestone, both for Intel and for Europe”. He adds that “the EU Chips Act will enable private companies and governments to work together to dramatically advance Europe’s position in the semiconductor industry.”
This week, Intel also announced a $25 billion investment in Israel.