It was stated that Germany will give incentives of up to 10 billion euros for Intel’s chip investment. Intel initially estimated that the Magdeburg project would cost 17 billion euros, but according to new calculations, the project is expected to cost 30 billion euros.
One of the world’s largest chip manufacturers, the US-based company Intel Corp., plans to build a large chip factory in Germany as well as its facilities in Ireland and France.
Germany and Intel signed an agreement on a 10 billion euro ($10.9 billion) subsidy for the chip manufacturing facility to be established in Magdeburg, East Germany, citing sources, Bloomberg reported.
Intel had initially agreed to build the plant in the city of Magdeburg with state aid of 6.8 billion euros, but delayed starting the plant’s construction due to economic turmoil.
The project is expected to cost 30 billion euros.
According to the sources in question, the expanded package currently agreed will include both traditional aid in the form of financial subsidies and energy price ceilings. Intel initially estimated that the Magdeburg project would cost 17 billion euros, but according to new calculations, the project is expected to cost 30 billion euros.
On the other hand, sources detailing the project reported that roughly 40 percent of Intel’s costs will be subsidized through the European Union’s Chip Law.
Intel had chosen Poland for its new chip factory.
Intel CEO Gelsinger has recently embarked on a massive expansion program aimed at diversifying centers producing critical chip components to reassert previous dominance in the industry.Intel announced on June 16 that it would set up a chip factory in Poland with an investment of $4.6 billion.
On the other hand, it was stated that the new factory in Poland is planned to be operational in 2027 and to employ 2 thousand people.
The company also announced in September 2021 that it could invest up to 80 billion euros in Europe over the next 10 years.