Intel seeking $9.7 billion EU investment to build chip factory in Europe

Intel is due to announce a $200 million investment in a new chip development campus in Israel and hire 1,000 staff.



As the chip shortage gains momentum and forces industries heavily reliant on the technology to look for alternate ways to meet the shortfall. Intel, the pioneer in chip making, wants 8 billion euros ($9.7 billion) in public subsidies to build a semiconductor factory in Europe.

Intel, which was falling behind its peers in meeting the demands of the industry for micro semiconductors, is now ambitiously seeking this amount to compete with its Asian rivals.

“What we’re asking from both the U.S. and the European governments is to make it competitive for us to do it here compared to in Asia,” said Pat Gelsinger in an interview with Politico. Thought Gelrsinger later denied that he had put a figure on the investment he was looking for. He emphasized that the EU leaders needed to concentrate on building an alternative hub to the Asian supremacy over the production of the chips.

semiconductor auto chip shortage

Gelsinger is on a trip to Brussels to talk about business opportunities in the region. He held talks with the EU Commissioner Theirry Breton. He wants the region’s chip output to be 20 percent over the next decade. Intel recently launched a plan to invest $20 billion in chip production in the United States.

Breton has been holding talks with the largest producer of chips, the Taiwan Semiconductor Manufacturing Company, and Samsung to explore options.

“To meet current & future semiconductor industry demand, Europe will drastically increase production capacity – both on its own and through selected partnerships to ensure the security of supply,” said Breton.
TSMC said the talks with Breton demonstrated its commitment to the region. “Our desire to support our customers as fully as possible means that we’re always willing to establish open communications with governments and regulators wherever they, and we, are based,” the company said.

The recent disruption in the supply chain of chips has forced companies and governments to rethink the dependency on the Asian region for chips.

The shortage even led Germany’s economy minister, Peter Altmaier, appealing to his Taiwanese counterpart Wang Mei-hua, to intervene on behalf of carmakers.

Other countries, including Japan and the US, have urged Taiwan to help ease the shortage. Altmaier’s has also said that the government will invest more in homegrown chipmakers to avoid future crises.

However, Reinhard Ploss, chief executive of Germany’s Infineon, one of the largest semiconductor manufacturers in the world, said that while the industry would “need to think again” about supply chains, there was a limit to how long chips could be stored in a stockpile.

Analysts caution Europe’s shrunken technology base means it doesn’t offer a viable market for a leading-edge plant. Of the Big Three chipmakers, Intel is the only one so far to express concrete interest in Breton’s goal of producing the most advanced chips in Europe.

“Geopolitically, if you’re in Europe, you want to be in continental Europe,” Gelsinger told Politico. “We think of Germany as a good candidate – not the only, but a good candidate – for where we might build our fabrication capabilities,” he said.

Intel is due to announce a $200 million investment in a new chip development campus in Israel and hire 1,000 staff.

Anna Domanska
Anna Domanska is an Industry Leaders Magazine author possessing wide-range of knowledge for Business News. She is an avid reader and writer of Business and CEO Magazines and a rigorous follower of Business Leaders.

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