Intel asks Germany for more funding to build Magdeburg mega fab
Last March, Intel unveiled its European semiconductor plans. Intel will invest 33 billion euros in the first phase, of which 17 billion euros will be used for the project in Magdeburg, Germany, to build two new fabs, which are expected to start construction in the first half of 2023 and are scheduled to start production in 2027. At that time, it was reported that Intel would receive about $5.5 billion in state aid for the project, accounting for about 29.4% of the initial project cost.
An architectural rendering of Intel’s proposed, $700 million Oregon Research and Design Mega Lab, which the company had planned to open this year at its Jones Farm campus in Hillsboro. The company said it’s pursuing cheaper options instead. Intel image
According to Theregister, Intel has received nearly 6.8 billion euros in subsidies from the German federal government, but in Intel’s view, it is far from enough. Now it has requested an additional 3.2 billion euros, a total of 10 billion euros in subsidies. According to sources, Intel is worried that the current geopolitical situation and the decline in demand for semiconductors in the market, coupled with inflationary factors, will eventually push up costs.
At the beginning of last year, Intel also announced an investment of more than $20 billion to build two new fabs in Ohio, USA, and the first fab will be put into production in 2025. In fact, it will end up costing more than $5 billion, which is a lot more than the original estimate, so it is not difficult to understand why Intel wants to fight for more subsidies on the Magdeburg project and may encounter similar problems.
In addition, there are reports that Intel is considering an additional $3.3 billion investment in Vietnam. It is not clear what the specific plan is, but it is rumored that it may be a chip packaging facility, which is located in Ho Chi Minh City. Intel responded with a statement, saying Vietnam is an important part of its global manufacturing network but has not announced any new investments.
