The cost of a state-of-the-art semiconductor manufacturing facility is already over $10 billion, and the more advanced process technology used, the higher the cost. In Europe, however, inflation, rising energy prices, and rising material costs have pushed Intel’s German factory costs so high that the company is now seeking another $5 billion in subsidies from the German government. reported. bloomberg.
When Intel announced plans to build a fab near Magdeburg, Germany, it said the production facility would cost $18.7 billion and would receive $7.2 billion in state aid to complete the project. . This location near Magdeburg was set to become Intel’s next major fab campus, which would cost him as much as $88 billion. But the German automaker couldn’t get all the chips he needed in 2020-2022, so he was happy to help Intel set up a new manufacturing site near Magdeburg.
However, the company has since been forced to postpone the construction of the chip plant and now believes that high energy prices, material costs and high inflation will necessitate spending $31.675 billion (€30 billion) on the project. I’m here. This is why Intel needs a further $4.223 billion to he $5.279 billion (€4 to €5 billion) subsidy from Germany.
The chip giant did not directly confirm the amount, but confirmed that it was mentioned in a meeting with the German government, which is renegotiating the deal.
“The global economic turmoil has increased costs from construction materials to energy,” Intel said in a statement. “We appreciate the constructive dialogue with the federal government to address the cost gap that exists by building elsewhere and to make this project globally competitive.”
The German economy ministry declined to comment on talks with CPU giants, but reaffirmed that the EU’s target of producing 20% of global chip output by 2030 is still in force. .
“With this goal in mind, the federal government stands ready to support the German semiconductor industry with billions of euros and enable the establishment of new factories,” the ministry said, adding that the additional funding will include European It added that approval from the committee was required.
In addition to the German fab, the company plans to build an R&D center in France. According to Bloomberg sources, the project is progressing well.
