On Monday June 19, German Chancellor Olaf Scholz signed the largest check ever granted to a foreign company across the Rhine. Ten billion euros to help the American electronics manufacturer Intel build a semiconductor factory in the city of Magdeburg, between Berlin and Hanover. This site will employ 3,000 people directly, to which will be added another 7,000 for construction.
Thus, this will represent 1 million euros of subsidy per job created. Madness in the eyes of many economists and with regard to state budgets, but the price to pay for Europe if it intends to stay in the technological race. France did the same, granting 3 billion euros in subsidies for a factory in Grenoble owned by STMicroelectronics and the industrial company GlobalFoundries, which will employ a thousand people (excluding construction), or 40% of the total investment.
The issue is the same as that which pushes the United States of Joe Biden to release 50 billion dollars (46.2 billion euros) to make chip factories flourish in the Arizona desert or in the Ohio: reduce dependence on Asia in the manufacturing of the most strategic building block of modern industry: the semiconductor. It controls all of today’s objects, from telephones to automobiles, and is at the heart of the new wave that is sweeping, that of artificial intelligence (AI) which requires ever more powerful computers to train it. .
A unique opportunity for Intel, the former king of electronics, dethroned, at the turn of the 2010s, by smartphone masters like Apple or, more recently, components for AI such as Nvidia. Its new boss, Pat Gelsinger, an industry veteran, was called back in 2021 to resurrect the group. It is counting on its colossal resources to catch up with the only two companies in the world capable of producing the latest generations of chips: the South Korean Samsung and the Taiwanese TSMC.
Intel is investing more than $100 billion in new factories in the United States, Europe and Japan. A bet on industrial gigantism carefully distributed across the planet, taking advantage of subsidies from states eager for technological sovereignty in the face of Chinese ambitions. He explains it to World.
Intel is no longer the king of electronic chips. Today, a company like Nvidia, for example, is worth six times more than you on the stock market. Can Intel turn around?
Nvidia’s results are remarkable. It is clear that artificial intelligence has become a huge growth engine for IT. This will benefit many of our products, for example in PCs. But Intel also has the ambition to become a major manufacturer serving other manufacturers. So we hope to be able to eat both halves of the apple: becoming a manufacturer for Nvidia, while producing chips that will compete with theirs.
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