Intel unveils $36B European plans
Chipmaker Intel Corp. is investing 33 billion euros ($36.13 billion) across manufacturing and research and development expansions across the European Union, the latest in the company’s aggressive investment strategy.
The semiconductor manufacturer unveiled plans to:
- Build two new factories, or fabs, in Magdeburg, Germany
- Expand its Leixlip, Ireland, facility
- Build a new facility in Italy
- Create an R&D hub in Plateau de Saclay France that will be the the European headquarters for high performance computing and AI design
- Increase its existing lab space in Gdansk, Poland that works on deep neural networks and cloud computing, and
- Invest in joint labs in Barcelona, Spain focused on supercomputing
Over the course of the next decade this initial investment could grow to 80 billion euros ($87.6 billion). In a similar situation to the U.S., Intel is seeking government support on these investments.
“Our planned 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,” said Intel CEO Pat Gelsinger, in a written 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.”
Intel has been teasing a big new European investment over the last year. It’s part of Gelsinger’s strategy to turn around the chip giant and regain technical prowess while also diversifying a semiconductor ecosystem that is reliant on Asia.
Intel is based in Santa Clara, California, but its largest manufacturing facility is its Ocotillo Campus in Chandler, where it employs 12,000 people and where it is expanding with two new fabs and planning to add 3,000 workers in a $20 billion project.
There are three chip companies that make the most cutting edge chips: Intel in the U.S., Samsung in South Korea and TSMC in Taiwan. That number is down drastically from 25 companies 20 years ago.
Gelsinger has highlighted these stats as he sells his vision to investors and governments. The percentage of chips made in Europe has gone from 44% to 9% over the last 30 years.
Intel has 10,000 employees in the EU. The company said it has spent more than 10 billion euros ($10.94 billion) with European suppliers over the last two years. That number is expected to nearly double by 2026, the company said in a news release.
Construction on the Germany fabs is expected to begin in the first half of 2023 with production anticipated to start in 2027, pending European Commission approvals. Initial investment in this project is 17 billion euros ($18.6 billion).
These fabs will be capable of making Intel’s most advanced chips. Based on the construction timelines, these fabs would manufacture chips in what Intel is calling the “Angstrom” era, or chips that measured in units smaller than a nanometer.
Intel’s current generation of chips are 10 nanometers. It is working on chips that are 7 nanometers. A nanometer is very tiny: A human hair is 80,000 to 100,000 nanometers wide.