Intel launches first phase of €80bn EU chip plan
As the semiconductor shortage continues to affect production across Europe, US tech giant Intel has revealed it will be launching the first phase of its €80 billion chip plan.
An initial wave of €17 billion is set to be invested in two factories in Germany, alongside R&D facilities in France, Italy, Poland and Spain, marking the first major piece of news since the scheme was announced back in September 2021.
Read more: Intel to invest €80 billion into EU chip production
Intel is hoping to tackle the chip shortage directly in the bloc, hoping domestic production can bolster resilience in the semiconductor supply chain. This also falls in line with the EU's plans to increase semiconductor production across the EU as part of the EU's long-awaited Chips Act.
“Our investments are a major step both for Intel and for Europe. The EU Chips Act will empower private companies and governments to work together to drastically advance Europe’s position in the semiconductor sector", Intel CEO Pat Gelsinger said in a statement.
"This broad initiative will boost Europe’s R&D innovation and bring leading-edge manufacturing to the region for the benefit of our customers and partners around the world. We are committed to playing an essential role in shaping Europe’s digital future for decades to come".
Development on the German sites is expected to commence immediately, with production expected to start in around 2027, pending approval by the European Commission.
The corporation refers to this as a potential new "Silicon Junction", mimicking the silicon valley tech hub in the US.
Up to 10,000 new jobs could also be supported by the project - 7,000 during construction and 3,000 new jobs once the plant is up and running.
Intel will also supply an additional €12 billion into its expansion in Ireland, which should see its Leixlip plant double in manufacturing capacity. Once complete, total investment into Ireland will total around €30 billion, the company claims.
In addition, Intel will also be spending €4.5 billion on a new plant in Italy that could create as many as 1,500 jobs between 2025 and 2027.
In total, the firm is looking to spend at least €33 billion on the initial wave of its chip plan as part of plans to increase semiconductor resilience.
The rest of the money will be spent over the course of the decade. The €80 million laid out for the plans comes in at almost four times the company's original pledges, which was to see €20 billion spent in gigafactory development across the continent.
Read more: Looking beyond the semiconductor shortage
Current estimates suggest the semiconductor shortage will persist into 2023, and so increasing domestic production - and bolstering supply chains - may be the key to ensuring another crisis doesn't happen again.
It has only been exacerbated by the automotive industry's push towards electrification and the soaring demand for consumer electronics owing to the pandemic.
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