Intel seeks up to $5.3B more in subsidies for German chip plant - report
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Intel (NASDAQ:INTC) is looking to gain another $4.2B to $5.3B (EUR 4B-5B) in subsidies from the German government for its upcoming plant in Magdeburg.
The chipmaker had already secured around $7.2B in government subsidies to build the manufacturing plant, but postponed the start of constuction in 2022 citing the current macroeconomic headwinds. Energy prices have surged and inflation has led to higher construction costs in Europe since early 2022.
Now Intel (INTC) is looking for more government support, according to Bloomberg citing unnamed sources. The company said in a statement it was facing higher costs amid economic disruptions, and is in talks with the German government to address the "cost gap that exists with building in other locations".
Intel estimates the new plant to cost EUR 30B, up from its earlier estimate of EUR 17B. The chipmaker expects around 40% of the cost to be subsidized, like other projects being funded by the EU's Chips Act.
The German government declined to comment but reiterated the EU's plans to produce 20% of global semiconductors by 2030 and said it is prepared to support the semiconductor industry with "several billion euros" to set up new factories.
The EU Chips Act - introduced in 2022 - aims to spend EUR 43B to build up the semiconductor industry in the region.
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