Intel delays German factory opening due to energy price hikes, hopes for more subsidies
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Update time : 2022-12-25 16:54:15
Intel has abandoned its goal of building a new chip factory in the eastern German city of Magdeburg in the first half of 2023, according to German newspaper Volksstimme, which reports that the semiconductor giant wanted more financial subsidies.
According to the report, Intel's initial plans were scuttled by a sharp increase in the price of energy and raw materials. Intel's initial cost budget was 17 billion euros (about 125.8 billion yuan), while reports say it now needs to spend nearly 20 billion euros (about 148 billion yuan), leaving a huge funding gap in between.
The plant was decided upon by Germany and the EU during the height of the New Crown epidemic, with Europe looking to strengthen its plans for European resilience by developing more semiconductor manufacturing operations locally to avoid long-term, cross-territory supply chain risks.
Commenting on this, Intel spokesman Benjamin Barteder said, "Increased geopolitical challenges and lower demand for semiconductors mean we can't yet give a firm date for the start of construction."
Intel is currently discussing with the local government how to bridge the funding "gap" and "the targets are off in the current situation. We are working with our government partners to drive a breakthrough in this project."
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