Intel to invest up to 80 bn Euros to boost EU chip capacity

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The company’s CEO named the figure at a Munich trade show this week.

Reuters has reported that Intel could invest as much as 80 billion euros in Europe over the next decade to boost the region’s chip capacity and will open up its semiconductor plant in Ireland for automakers.

Intel CEO Pat Gelsinger also said the company would announce the locations of two major new European chip fabrication plants by the end of the year. He made the remarks while speaking at Munich’s IAA auto show.

There is speculation about possible production sites. Germany and France are seen as leading contenders while Poland, where Intel also has a presence, also in the picture.

The CEO said the aim was for a “total project of 80 billion euros over the next decade”. He also added the move “would be a catalyst for the semiconductor industry… a catalyst for the entire technology industry.”

Gelsinger told Reuters in April that the company wanted to start producing chips for automakers within six to nine months. The goal, he said, was to help alleviate a shortage that has disrupted vehicle production around the world.

It is unclear whether the latest announcement means Intel will meet that goal.

Viewing automotive industry as producing “computers with tires”

“Cars are becoming computers with tires. You need us and we need you… The aim is to create a centre of innovation in Europe, for Europe,” Gelsinger said.

The “Intel Foundry Services Accelerator” helps automakers o make chips using “Intel 16” chip manufacturing technology. They will then later move to its “Intel 3” and “Intel 18A” technologies.

Those manufacturing processes would be far more advanced than most of the processes currently used in the automotive industry. Intel said that nearly 100 automakers and key suppliers had expressed support for its programmes. An Intel spokesman declined to confirm whether any had committed to becoming customers.

Gelsinger has been quoted saying Intel wants the EU to commit state aid to Intel’s proposed European investment drive.

Intel views automakers as a key strategic priority. Gelsinger said Tuesday that the company believes chips will make up 20% of the cost of vehicles by 2030,. This represents a five-fold increase from 4% of the cost in 2019.