US tech giant Intel has revealed its planned $20 billion (€16.9 billion) investment in a new semiconductor gigafactory could be shared among a number of EU member states.
Intel is one of the world largest chipmakers and has pledged to build a gigafactory in Europe to help address the global semiconductor shortage. Credit: Tester128 / Shutterstock
The group has been lobbying to win financial support for the project with the company's CEO Pat Gelsinger meeting with French President Emmanuel Macron and Italian Prime Minister Mario Draghi to discuss the chip shortage.
Gelsinger previously pledged to address the chip supply by increasing in-house production of semiconductors ahead of US President Joe Biden's plans to address domestic supply issues.
Read more: The semiconductor shortage may last into 2022
The company were also considering supplying chips for the automotive sector, which has been hit particularly hard by the supply shortages.
The bloc has hinted at plans for financial backing to allow for companies and governments to work to tackle the chip shortage and has already pledged towards increasing domestic production by 2030.
Intel's executives have revealed there could be "EU-wide benefits" should the company's requirements be met for its new plant, including possible expansion in Europe. The company also revealed research and development opportunities or spreading services across several member states.
Talking to the FT, Greg Slater, Intel vice-president of global regulatory affairs said the company could "put manufacturing on one site and packaging on another," and that spending on EU suppliers could "increase dramatically."
He added: “We are well placed to make this an ecosystem-wide project, not just a couple of isolated paths in one member state. We do believe that this is a project that will benefit Europe at large.”
Infrastructure on the project could reach around 1,000 acres, according to the tech giant's specifications, with the ability to support up to eight fabs.
The company's executives revealed two fabs will be built to start with, which would cover the entire $20 billion investment over a ten-year initial lifespan. Total investment could surpass $100 billion for the plant, they added.
French officials revealed Intel was looking at expanding into 10-nanometre chip production for Europe - a particularly advanced form of chip technology. They revealed the chipmaker was looking into building "an entire ecosystem" for chip production.
Both Intel and computing rival Nvidia have pledged to increase domestic production of chips, with Nvidia even willing to break into the CPU market to help address the shortage.
Read more: The scramble to end the semiconductor shortage
Nvidia's push into expanding its portfolio comes nearly a year after its acquisition of Arm, which some people fear may lead to a tech monopoly.
Many western chip companies are dependent on suppliers from East Asia and the shortage has been caused by increased demand for consumer electronics with the coronavirus pandemic alongside a demand surge for electric vehicles as part of several nation's pandemic recovery schemes.
Several major automakers had to cut production during the pandemic owing to the chip shortage, and companies like Nissan, Northvolt and Stellantis (with the aid of the Italian government) looking at increasing domestic production through overhauling or investing in gigafactory infrastructure.
This could go some ways to ensuring more robust supply chains and prevent these kinds of bottlenecks from occurring in the case of another global crisis.
Chipmakers have also revealed automakers may have to overhaul their supply chains to deal with the shortage.
Read more: Automakers may have to overhaul supply chains to address chip shortage
The topic of strengthening supply chains was also a major topic at the recent EU Industry Days event, held in March.
Supplying chips from either the EU or the UK was also one of the agreements made in Britain's post-Brexit trade deal after it withdrew from the bloc in January.
Automakers will have to supply all of their batteries and chips from within the EU or UK by 2027 or face heavy fines.
Back to Homepage
Back to Technology & Innovation
Back to Politics & Economics