The new subsidies aim at chip companies that can significantly exceed modern production capacities.
A new budget of about 2 billion euros will be released for this purpose. Although the exact amount is not yet final, Bloomberg sources report this is the expected direction. The ministry concerned has indicated that the amount is within “low single-digit billion euro range.”
During the global chip shortage, Germany took steps to build a strong chip industry. With a subsidy of nearly 10 billion euros, the country managed to convince Intel to establish a plant in Magdeburg. This giant production facility was supposed to cost 30 billion euros. However, Intel postponed construction due to financial challenges.
Tip: Intel split nears: Foundry becomes subsidiary
Future plans
Germany’s economy minister remains committed to strengthening the chip industry. Earlier this month, chip companies were allowed to apply for new subsidies. With the new billions available, there seems to be enough support. Still, there is uncertainty about long-term plans, especially as Germany elects a new parliament in February following the government’s fall in early November.
Germany must build a sector with future prospects. Indeed, the auto industry, traditionally a pillar of the German economy, is in dire straits. Car manufacturers and suppliers are facing major challenges.