Intel hopes for EU billions: Magdeburg chip works will be built from spring

From 2027, Intel chips should come from Magdeburg.

Intel hopes for EU billions: Magdeburg chip works will be built from spring

From 2027, Intel chips should come from Magdeburg. In addition, the construction of the semiconductor plants is to begin next spring. The chip giant from the USA hopes that the EU will have launched its multi-billion dollar subsidy program by then. But that could take a while.

The US chip manufacturer Intel is hoping for an early start next year when building its new semiconductor plants in Magdeburg. "We plan to break ground in the first half of 2023 and are optimistic that the EU Chips Act will also be passed during this period," said Intel's HR manager in Germany, Bernd Holthaus.

Chips are to be produced in Magdeburg from 2027. In a first expansion stage, two neighboring semiconductor plants are to be built, which could create several thousand jobs. Intel initially wants to invest around 17 billion euros in this. Whether the European Chips Act - a bill intended to mobilize tens of billions for the chip industry - will actually be passed in Brussels so quickly remains to be seen.

The aim of the EU countries is to agree on their position in December, as announced by the Czech EU Council Presidency. "This will be the starting point for negotiations with the European Parliament on the final text of the chip legislation," a spokesman said. Parliament still has to determine its position beforehand, however, and only in the next step would the two institutions negotiate what would probably be a final compromise.

How long the process will then take cannot be said with certainty. Everyone involved is aware of the importance of the project, but it cannot be ruled out that the negotiations could drag on for months. "An agreement at the end of the first quarter of 2023 is theoretically possible, but also very ambitious," said Green MEP Henrike Hahn.

With the law, the EU wants to prevent Europe from being further left behind by Asia and America in the production of microchips. Among other things, certain new semiconductor factories should be allowed to be more easily supported by subsidies. State aid for companies in the EU is actually only possible in exceptional cases so that competition is not distorted.

Overall, Intel hopes for generous government support to close the cost gap to other possible locations. According to the company, this is the only way to make these investments in Europe profitable. The federal government wants to support the settlement in Magdeburg with a billion amount. A total of 6.8 billion euros is to flow by 2024, with 2.7 billion being estimated in the 2022 budget alone.

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