Intel is rumored to receive nearly 10 billion euros in subsidies from the German government

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Author：netwing Time：2023-06-19 Browse：

According to foreign media reports, US technology giant Intel is expected to secure nearly 10 billion euros in subsidies to establish a chip manufacturing plant in eastern Germany.
Reuters reported on Thursday that Intel and the German government are close to reaching an agreement that the chip manufacturer will receive a subsidy of 9.9 billion euros (approximately 10.83 billion US dollars) to establish a chip manufacturing plant in eastern Germany.
According to reports, the final negotiations between Intel and the German government will be held this weekend. If the negotiations go smoothly, Intel CEO Pat Geisinger and government representatives will sign the agreement in Berlin next Monday (19th) local time.
According to insiders, considering the poor economic situation at the end of last year, Intel has postponed its plan to build factories in Europe and has been demanding more funds. It is understood that Intel initially estimated that the German chip factory would cost 17 billion euros, but now it is estimated that it will cost 30 billion euros.
According to insiders, like most projects that will receive government funding through the EU's Chips Act, Intel's factory construction plan is expected to receive about 40% of the subsidy.
The company previously agreed to build a chip manufacturing plant in Magdeburg, Germany, in order to receive a subsidy of 6.8 billion euros (approximately 7.2 billion US dollars) from the German government. Now, as part of the negotiations, Germany has agreed to increase the subsidy amount to 9.9 billion euros (approximately 10.83 billion US dollars), but negotiations on subsidies may continue until the weekend, and official news may be announced as soon as Monday.
It is reported that Intel's factory construction plan is also the largest foreign investment case in Germany since World War II, and is seen as a key factor in achieving the EU's goal of doubling the global semiconductor market share to 20% by 2030.
Another insider said that the German government is willing to provide more subsidies, but the prerequisite is that Intel must significantly increase its overall investment in this factory. It is worth noting that subsidies from the German government will be provided through various mechanisms, including price caps.
As of the time of publication, Intel and the German Ministry of Finance have not yet made public comments.

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