Intel wants $5bn more in German subsidies for chip plant – Bloomberg
Intel Corp (INTC.O) is seeking an additional 4 billion to 5 billion euros ($5.28 billion) in subsidies from the German government to build a chip manufacturing complex in the country, Bloomberg News reported, citing people familiar with the matter.
The US chipmaker last year postponed the plant construction in Magdeburg – for which it had reached a 6.8 billion euro deal in government subsidies, subject to approval from the European Commission – due to economic headwinds and is now looking for more aid, the report said on Tuesday.
Intel said in a statement disruptions in the global economy have resulted in increased costs, but it is committed to the project and appreciates “the constructive dialogue with the federal government to address the cost gap that exists with building in other locations.”
The company in March 2022 picked Germany as the site for a huge new chipmaking complex, as part of an $88 billion investment drive across Europe, which included boosting an existing factory in Ireland, setting up a design and research facility in France, and a packaging and assembly site in Italy.
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The initial spending was then estimated to total 33 billion euros, including 17 billion euros in Germany. However, Bloomberg News reported Intel now expects to spend 30 billion euros on its project in Germany.
Intel was expecting roughly 40% of its Germany project to be subsidized, under the EU’s Chips Act, but is now also open to other sources of government aid including tax breaks or energy subsidies, the report added.
The expansion in Ireland and France, meanwhile, remains largely on track, the people told Bloomberg News.