Intel is currently putting the pedal to the metal when it comes to building new chip factories. However, the world-famous company is sometimes faster than the politicians. For example, a lack of subsidies in the USA is currently causing concern about the construction of several chip factories in the US state of Ohio.
100 billion US dollar investment open
The world is still suffering from a never-ending semiconductor shortage. In order to finally be able to cope with this, work is being done at full speed to set up new production facilities for the valuable chip components. Taiwan recently made public its ambitious plans for what this could look like on a grand scale. The island state wants to invest a whopping 120 billion US dollars in the construction of new chip factories over the next few years. But the West is not sleeping either. In particular, the well-known manufacturer Intel has some plans for Europe and the USA. While people in Magdeburg are currently looking forward to the construction of the Intel Gigafactory for chip production, things are faltering in Intel’s home country – the USA.
With the EU Chips Act, the European Union has stipulated that it will invest in projects like Intel in Magdeburg to combat the semiconductor shortage. The USA also wants to launch a similar scheme. However, the funding package, which is also called the CHIPS Act, is currently still a long time coming. In view of the fact that Intel has set itself an investment of almost 100 billion U.S. dollars over the next few years, however, there is probably no alternative to political involvement. Otherwise, it could become existence-threatening for the planned site in Ohio, according to the chip manufacturer.
CHIPS Act hits the brakes
In its basic design, the US CHIPS Act sounds exceedingly enticing. Here, a bulging pot with lots of subsidies for manufacturing semiconductor factories is supposed to be waiting for willing companies. What seems really tempting in theory is unfortunately not very effective in practice – at least not yet. After all, U.S. policy is somehow not making any headway in executing its 52 billion U.S. dollar support package. What’s behind it? The news portal NBC reports that there are probably disagreements between the House of Representatives and the Senate. For example, both bodies are said to have already approved the CHIPS Act. However, the respective subsidy packages have different contents in each case.
Finding a common denominator now seems to be the big challenge, and one that just won’t happen. Intel itself says that it will probably have to raise 20 billion US dollars from its own capital. With this money, the two chip factories, each costing 10 billion US dollars, could be built. However, the remaining 80 billion US dollars are problematic. Here the company seems to need urgent support. Finally, in addition to the first two factories, whose construction is to begin in October, six more are to be built.
Magdeburg as a role model?
The planned Intel factory in Magdeburg shows how things can be better. Here, they want to produce state-of-the-art semiconductors in a few years. The project may be much smaller, with total costs of 17 billion euros, but it is supposed to be just the beginning for Europe’s chip production. Surprisingly, the mills of EU politics grind much faster here than overseas. After all, a total of 6.8 billion euros is to flow from the EU treasury as support for Intel’s project.
