BERLIN/STOCKHOLM (Reuters) – Germany is to give U.S. chipmaker Intel 10 billion euros in subsidies for its Magdeburg factory project, a source familiar with the matter said.
This agreement would put an end to months of negotiations on a project which should be worth around 30 billion euros.
Under Pat Gelsinger’s leadership, Intel has invested billions in building factories on three continents to reestablish its dominant position in semiconductor manufacturing and better compete with rivals AMD, Nvidia and Samsung.
The deal in Germany would be Intel’s third major investment in four days, after a $4.6 billion (4.21 billion euros) microchip factory in Poland and a $25 billion factory in Israel.
Chancellor Olaf Scholz said on Monday his government was working on investment projects that would make Germany one of the world’s leading semiconductor production sites.
The United States and Europe are trying to attract big industrial players through government subsidies and favorable legislation, and Berlin fears losing its appeal as an investment location.
Dependence on South Korea and Taiwan for chips is a growing concern.
Berlin is currently in talks with Taiwanese company TSMC and Swedish electric vehicle battery maker Northvolt to establish production in Germany, having already convinced Tesla to build its first European mega-factory there.
(Report Friederike Heine, Supantha Mukherjee and Andreas Rinke, Written by Christoph Steitz; Gaëlle Sheehan, edited by Kate Entringer)
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