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Intel unveils ‘landmark’ €33B investment in EU chipmaking

U.S. microchips giant Intel is investing tens of billions of euros in Germany, Italy, France and other European countries, in a boon for European policymakers’ ambition to catch up on global microchips production.

The project will “create a world-class chip ecosystem,” Intel’s Chief Executive Officer Pat Gelsinger said in an online announcement Tuesday, adding that the “landmark investment” would “restore” Europe’s leadership in the sector.

“The world has an insatiable demand for semiconductors, or chips,” Gelsinger said, adding that “the recent shortages have reminded us of the risks of being too dependent” on a limited number of large-scale manufacturing sites.

Intel’s pledge is a win for EU policymakers as the bloc seeks to double its market value across the global semiconductor supply chain by 2030. The company’s announcement is “a first major achievement under the EU Chips Act,” European Commission President Ursula von der Leyen said in a video message.

The bloc in February launched its legislative initiative to set up funding schemes and accommodate competition rules for the sector. Convincing one of the three leading chips manufacturers — TSMC, Intel and Samsung — to set up a “mega fab” manufacturing site in Europe was a key part of the EU’s strategy to catch up on global microchips production.

That objective will be met, as Intel pledged to invest €17 billion in a new mega fab in Germany to produce cutting-edge semiconductors.

The German project — which Intel is calling “the Silicon Junction” — will include two units to produce the high-end chips and be located in the central German city of Magdeburg. It will create 7,000 construction jobs as it’s built and 3,000 jobs for chips engineers in the longer term, Gelsinger said.

France will become Intel’s “European headquarters for high performance computing and artificial intelligence design capabilities,” the company said. It added that it is increasing its investment in Italy, where it wants to create 1,500 Intel jobs and is in the process of acquiring microchips company Tower Semiconductor. Other investments would go to Poland and Spain, Gelsinger said.

“All these investments will further strengthen Intel’s relationship with research institutes … across Europe,” the chief executive said, estimating that the company in total would invest more than €33 billion across the bloc.

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