Intel wants to build two chip factories in Germany and start production in 2027
Intel has officially announced its plans for a new European manufacturing site. The company wants to set up that location in Magdeburg, Germany. The company also plans to build research centers and back-end fabs in other EU member states.
Intel writes that the ‘mega location’ for chip production is being built in Magdeburg, as already expected. This city is located in the German state of Saxony-Anhalt. The company will initially build two factories at that location. Construction is to start in the first half of 2023. Intel expects production at those plants to begin in 2027. The manufacturer previously said that its European mega location could eventually be expanded to six to eight separate factories.
The chip giant also says that the factory will produce chips on Intel’s “most advanced” processes. Intel speaks in a press release about ‘ångströmtransistors’. The company will switch to that ångström naming from 2024, with Intel 20A, which corresponds to 2nm. Later, the company will come up with more advanced processes, including Intel 18A.
Intel does not comment on the exact nodes that will be used in Magdeburg. The company does say that the factories will produce chips for external customers as well as for Intel itself. The distribution of production capacity between Intel chips and external chips is unknown. The factory would also provide 3000 permanent jobs, Intel claims.
Renders of the Intel location in Magdeburg, Germany. Source: Intel Corporation
Other EU investments: factory in Ireland, packaging and R&D
In addition to the chip production location in Germany, the company is also making other investments in Europe. The company has previously indicated that it is expanding its chip factory in Ireland. With this, the manufacturer wants, among other things, to double its production capacity in Ireland. Intel does not announce when exactly those extensions should be ready.
Intel is also negotiating with Italy to build an advanced back-end manufacturing facility. That factory would, among other things, take on the packaging of chips and should be operational between 2025 and 2027. Reports have already been circulated about the construction of a packaging factory in Italy, Reuters wrote at the beginning of this month. That country would allocate 4 billion euros for the chip sector. Some of that could go to Intel if it decides to build a factory in Italy.
Intel also has plans for an Intel R&D site in France. That hub will be located in Plateau de Saclay, about 20 km south of Paris. Intel says France will become Intel’s “European headquarters” for developing and designing high-performance computing and AI chips. A foundry design center will also be established in France, where it aims to offer chip design services to European customers. The company also talks about research centers in Poland and Spain.
Intel’s Expansion Plans in Europe
Investments and subsidies
According to Intel, total investments amount to 33 billion euros. According to the company, those investments could reach 80 billion euros in the coming decade. The company said earlier that it wants to receive a subsidy for at least the two chip factories. According to the company, this is necessary to make the construction of chip factories in Europe more attractive compared to other regions, such as Asia.
The recently presented European Chips Act should make this possible. As part of that plan, strict European rules on state aid will be relaxed, allowing individual EU member states to provide subsidies to the chip sector. This is in the hope of making Europe less dependent on production locations in other regions. With those plans, the EU is following other countries, including the US with its American Chips Act.
Ursula von der Leyen, President of the European Commission, welcomed Intel’s commitments at a press conference. Von der Leyen says Intel’s announcements are “the first major achievement of the Chips Act.” The Chips Act still has to be approved by the European Parliament and individual member states.