German subsidy will pay for 40 percent of Intel's new fab site in the region

Shawn Knight

Posts: 14,340   +165
Staff member
The big picture: Germany is looking to pump up its local microelectronics industry and is using lucrative subsidies to attract chipmakers to the region. Intel has already signed up to participate but at least one other major chipmaker is still on the fence.

Local media (per The Register) claim Intel will receive 6.8 billion euros ($7.15 billion) in subsidies to build a cutting-edge campus in Magdeburg. Intel announced the colossal project in March and pegged the initial cost at no less than 17 billion euros. The German subsidy will cover roughly 40 percent of the total cost.

Intel's expansion in the region will go a long way to helping the EU reduce its reliance on chip imports. In February, the European Union announced the European Chips Act with the goal of doubling its share of the global semiconductor market by 2030.

The local government is interested in hosting other chipmakers as well but not everyone is ready to play ball right now.

Earlier this week, Taiwan Semiconductor Manufacturing Co Chairman Mark Liu said they have relatively few customers in Europe. TSMC is still assessing the possibility of expanding into Germany but they "do not have any concrete plans" as of now, Liu added.

Intel is on track to begin construction in the first half of next year. Should everything go according to plan, the hub will create around 3,000 permanent jobs for locals. Mass production of chips on an advanced process node will commence in 2027.

Permalink to story.

 

Last1Standing

Posts: 58   +25
So, still, over 10B left out-of-pocket for Intel to cough up. Didn't Intel just beg the US gov for some money, etc. recently? So, Americans are paying for Intel to move jobs from them and to relocate those jobs to foreigners under Biden's watch, huh?

Capitalism or Scumism?!
 

nodfor

Posts: 297   +503
So, still, over 10B left out-of-pocket for Intel to cough up. Didn't Intel just beg the US gov for some money, etc. recently? So, Americans are paying for Intel to move jobs from them and to relocate those jobs to foreigners under Biden's watch, huh?

Capitalism or Scumism?!
Politicians want new fabs at their country/state so the subsidy game is on
 

Skjorn

Posts: 696   +570
So, still, over 10B left out-of-pocket for Intel to cough up. Didn't Intel just beg the US gov for some money, etc. recently? So, Americans are paying for Intel to move jobs from them and to relocate those jobs to foreigners under Biden's watch, huh?

Capitalism or Scumism?!
I don't think they're moving jobs from anywhere to there? It's a new fab. They're building a couple. No one is taking our jerbs!
More like Europeans paying for Intel to make a fab there. I don't like biden either but come on man!
 

dangh

Posts: 691   +1,082
So, still, over 10B left out-of-pocket for Intel to cough up. Didn't Intel just beg the US gov for some money, etc. recently? So, Americans are paying for Intel to move jobs from them and to relocate those jobs to foreigners under Biden's watch, huh?

Capitalism or Scumism?!
Intel european office earn a lot of money in Europe, so calm down - this is not taken from US taxes, but from income generated in place. It is only smart to make a factory where customer are. Or you as well blaming BMW for having factory in US even if they are German company and they waste Germans taxpayers money? :D
don't overreact.
 

Axeia

Posts: 46   +45
So, still, over 10B left out-of-pocket for Intel to cough up. Didn't Intel just beg the US gov for some money, etc. recently? So, Americans are paying for Intel to move jobs from them and to relocate those jobs to foreigners under Biden's watch, huh?

Capitalism or Scumism?!
If anything it's an American company enjoying German taxpayers money. We all want to get away from relying on Taiwan as the major chipset source. For Europeans that means subsidising Intel or Samsung (TSMC seems to have no interest in moving fabs outside Taiwan). The EU does want to invest in the semi conductor market but lining the pockets of American companies is not the way.
Sadly the EU semi conductor market is quite dead so it would have to start basically all the way from the start putting them in a similar position as Russia is now in. Stuck on old irrelevant nodes and having to invest billions to catch up to still decades old tech.
 

Vanderlinde

Posts: 156   +104
I knew it. Intel went out for shopping. We want to plant a big factory. Which goverment or country provides the best subsidy?

And in the meantime still charge premium.
 

psycros

Posts: 4,344   +6,356
I knew it. Intel went out for shopping. We want to plant a big factory. Which goverment or country provides the best subsidy?

And in the meantime still charge premium.

Literally every business in the free world. That's another aspect of capitalism - local governments have to court the enterprises they want to attract. Where I live its almost comically abused. A major company moves in only if they don't have to pay taxes for years. As soon as that tax holiday ends they close up shop and relocate (or declare bankruptcy and just start up again under a new name). Its still better than China sucking all that wealth away from the west, though.
 

AlaskaGuy

Posts: 455   +351
I knew it. Intel went out for shopping. We want to plant a big factory. Which goverment or country provides the best subsidy?

And in the meantime still charge premium.
The Germans came to Intel seeing how Germany's automobile industry is big and they need the chips.
 

Irata

Posts: 2,196   +3,792
I'm still wondering if it wouldn't make more sense to subsidize Global Foundries who already have a plant in Germany instead.

Unlike Intel, their main business is making chips for others.
 

HardReset

Posts: 1,717   +1,377
I'm still wondering if it wouldn't make more sense to subsidize Global Foundries who already have a plant in Germany instead.

Unlike Intel, their main business is making chips for others.
Sadly, GlobalFoundries have no bleeding-edge node currently or even in development.
 

HardReset

Posts: 1,717   +1,377
But is that needed for industrial / automotive chips ?

Their 16 and 12 nm FDX nodes should be more than fine for most industrial applications.
GF is already producing those in Dresden fab. GF also had applied for EU funding for Dresden fab expansion, no idea if they got it.

However Intel or TSMC can offer something GF cannot. TSMC seems to stay out so Intel is basically only choice to get top notch nodes into EU.
 

captaincranky

Posts: 18,842   +7,760
So, still, over 10B left out-of-pocket for Intel to cough up. Didn't Intel just beg the US gov for some money, etc. recently? So, Americans are paying for Intel to move jobs from them and to relocate those jobs to foreigners under Biden's watch, huh?

Capitalism or Scumism?!
This should serve to illustrate how massively uninformed you really are

Intel's $100B Ohio 'megafab' could become world's largest chip plant
. With eight fabs planned, the site near Columbus is a centerpiece of an effort to restore US chipmaking prowess. President Biden is pushing for legislation that would speed Intel's work.Jan 21, 2022.

Since you chose to bring politics into this; these plants will come to fruition, unless Mitch McConnell and his goon squad put the kibosh on it, then find a way to blame it on Biden.

Here's some additional reading on Intel's fabs:

 
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