In context: Intel has been active in the European Union for 30 years and employs approximately 10,000 people in its 27 member states. Now the newly formed Foundry Services division of the silicon giant is looking to take up a bigger chunk of the semiconductor space, and its latest move is a European manufacturing arm that will make everything from microcontrollers to the most advanced chips for phones, computers, servers. and network infrastructure.
Intel last year unveiled an ambitious plan to create a new European chip factory as part of its IDM 2.0 strategy. At the time, the company said it would invest up to €80 billion ($87.5 billion) over the next few years to build at least two plants in the region, but their exact location remained a mystery.
Today, the company announced “Silicon Junction” – the first phase of an aggressive multi-year plan to expand and diversify its manufacturing capabilities. The plan begins with a new, cutting-edge megasite in Magdeburg, Germany, which is another way of saying Intel will build a campus the size of a small town. The project will cost no less than €17 billion ($18.6 billion) from the investment fund, mirroring many of the aspects of another Intel facility to be built in Columbus, Ohio.
The German hub will house around 3,000 permanent workers and 7,000 temporary workers for the construction work. But more importantly, it will play an important role in the European Union’s plan to reduce its dependence on chip imports. The EU has set itself an ambitious target of achieving a 20 percent market share in semiconductor manufacturing volume by 2030, and to that end companies like Intel will be able to tap into a huge pool of grants worth €145 billion ($158.7 billion) from the Recovery and Resilience Fund.
Intel expects to break ground at its Magdeburg site sometime in the first half of 2023, with mass production planned to start in 2027. Interestingly, the company plans to equip its two Magdeburg plants with advanced manufacturing tools capable of processing chips. to be produced on a sub-3nm process node such as Intel 20A and Intel 18A. These advanced chips will be the first to integrate Intel’s RibbonFET technology, a new class of transistors designed for “Angstrom-era” products.
Team Blue’s ambitions in Europe don’t stop there. Intel will spend an additional €12 billion ($13.1 billion) to expand its Leixlip, Ireland campus with an additional manufacturing facility, bringing total investment in the region to €31 billion ($33.9 billion) and the number of permanent employees 6,500.
In addition to expanding the site’s capacity, Intel plans to equip the new plant to produce chips on an Intel 4 process node, which would be a boon to the EU’s dream of “strategic autonomy”. The EU has several major projects around RISC-V processors and hyperscale cloud systems that can greatly benefit from a well-developed local supply chain of advanced semiconductors.
Italy will also see a €4.5 billion ($4.9 billion) investment from Intel in the form of a manufacturing facility that could start operating in 2025 and create about 1,500 permanent jobs.
Following its $5.4 billion acquisition of Israeli specialty chipmaker Tower Semiconductor, Intel plans to leverage the latter’s partnership with the local branch of STMicroelectronics to build more manufacturing capacity for mature process nodes. This would positively impact automakers and industries that rely on less advanced chips.
In addition, Intel plans to spend billions in the coming years to expand its research and development centers in France, Poland and Spain, which focus on foundry technologies, high-performance computing, neural networks, graphics, audio technology and more. This effort will create more than 1,000 additional jobs in these countries.
Intel CEO Pat Gelsinger believes these investments will help build a more resilient semiconductor supply chain. It doesn’t aim to solve the ongoing chip shortage, but with additional investment from companies like TSMC, Samsung and smaller chipmakers, the semiconductor industry as a whole will be better protected from trade wars, factory closures and rising demand.
This post Intel announces Silicon Junction, a €17 billion manufacturing facility in Germany
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