Dispute over subsidies: start of construction of the Intel chip factory probably postponed

The planned Intel factory in Magdeburg should reduce dependence on China for the production of semiconductor chips.

Dispute over subsidies: start of construction of the Intel chip factory probably postponed

The planned Intel factory in Magdeburg should reduce dependence on China for the production of semiconductor chips. The construction work was actually supposed to start in the first quarter of this year, but the start of construction has now been delayed due to uncertainties regarding government subsidies.

The start of construction for Intel's planned chip factory in Magdeburg has probably been postponed due to ongoing negotiations about subsidies with the federal government. As reported by "Welt", no date has yet been set for the start of construction, a company spokesman said when asked by the newspaper. As long as the subsidies are not legally certain, one does not want to start.

When the project was announced last year, the state government of Saxony-Anhalt assumed that construction would start in the first quarter of 2023. The newspaper reports that this is no longer tenable. In addition, the US chip manufacturer could adjust the investment volume or stretch the time frame of the investment and not fully expand the plant at first.

"A lot has changed since we presented the plans for the factory in Magdeburg at the beginning of 2022," the Intel spokesman quoted "Welt". "Geopolitical challenges have increased, demand for semiconductors has decreased, inflation and recession are challenging the global economy. We are closely monitoring market developments and will adjust the pace of our investments accordingly." However, Intel stands by the project.

In response to a request from the Leipzig member of the Bundestag Sören Pellmann to the Federal Ministry of Economics on the subject, State Secretary Sven Giegold confirmed that renegotiations were currently taking place: "The Federal Ministry for Economic Affairs and Climate Protection is currently in talks with Intel about the specific design of any funding," the Green Party said. Politician in reply stated the world was present on Sunday. He "does not expect an increase in the funding framework". So far, Intel has only received a non-legally binding "Letter of Intent" as a funding commitment. This letter from October 2021 still comes from the previous government.