HomeBusinessEurope waits its turn as Intel commits to new US chip factories

Europe waits its turn as Intel commits to new US chip factories

BERLIN/STOCKHOLM : Intel’s announcement that it’s going to make investments greater than $20 billion in two new semiconductor crops within the United States is in sharp distinction to its silence on European plans initially flagged final yr.

The firm mentioned in September that it may make investments as a lot as $95 billion in Europe over the subsequent decade and announce the areas of two main new European chip fabrication crops by the tip of 2021.

But no announcement has been made, whereas Intel on Friday laid out plans to construct an enormous new manufacturing website close to Columbus, Ohio.

Analysts mentioned the corporate could possibly be ready for the introduction of new laws earlier than deciding on a European location. The European Chips Act goals to scale back the continent’s dependence on Asian suppliers for superior semiconductors by subsidising the native improvement of enormous chip factories.

Intel has been in talks with governments of varied European international locations as it scouts for a location, together with these of Germany and Italy.

“We are excited about the conversations we are having … Details are confidential, but we will make an announcement as soon as possible,” an Intel spokesperson mentioned.

Gartner chip analyst Alan Priestley mentioned that with the deliberate Ohio website, stress on Intel to find a website in Europe may have diminished.

“They could also delay the decision if they expect the European Chip Act to have material impact on the financing,” he added.

The European Commission will suggest the laws in early February, and trade analysts anticipate it to move later this yr.

However, any extra capability would want to begin being constructed out now, as it will probably take three to 4 years for a chip manufacturing unit to attain a major output degree, mentioned Ondrej Burkacky, a senior accomplice at McKinsey.

Germany tops the listing of potential candidates with the native governments of Penzing in Bavaria and Magdeburg and Dresden in japanese Germany attempting to tempt Intel.

However, the mayor of Penzing advised Reuters in December that he by no means heard again from Intel.

European carmakers have been compelled to minimize manufacturing due to chip shortages final yr as they jostled with client electronics makers to purchase semiconductors.

Most of chips utilized by European firms come from three Asian suppliers – Taiwan Semiconductor Manufacturing Co, Samsung, and United Microelectronics.

(Reporting by Supantha Mukherjee, European Technology & Telecoms Correspondent, based mostly in Stockholm, Nadine Schimroszik in Berlin; extra reporting by Elvira Pollina in Milan; Editing by Kirsten Donovan)

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