US chipmaker Intel will build a $4.6 billion plant in Poland

Intel is to build a $4.6 billion semiconductor assembly and test plant in Poland, as the US chipmaker bets that Berlin will meet demands for more subsidies in connection with a planned manufacturing facility across the border in Germany.

The plant in Wroclaw will help meet “significant demand for assembly and test capacity,” which Intel says it expects to be ready by 2027. This is even as its €17bn wafer manufacturing facility in the German city of Magdeburg is expected to be up and running. ,

But since the US chipmaker announced its German plans last year, it has launched tough talks with Berlin, arguing that inflation and higher energy costs have outweighed the €6.8 billion subsidy the government originally promised for the project. Inadequate pledge was made for

Intel is now seeking an additional €4 billion in government support – an amount that Germany’s Finance Minister Christian Lindner rejected in an interview with the Financial Times. Lindner said two weeks ago, “There is no more money available in the budget.”

However, German media are reporting that Berlin may bow to Intel’s demands.

Several European countries are racing to reduce their reliance on Asian suppliers of semiconductors, following the pandemic’s ravages of shortages in many of its key industries.

The chips that Intel specializes in, however, are not the type on which, for example, Europe’s large automotive industry depends. This has prompted critics to question whether Berlin’s wooing of Intel is the best use of taxpayer money.

Intel, which also manufacturers in Ireland, said the Polish facility was expected to create 2,000 jobs.

Poland’s Prime Minister Mateusz Morawiecki said he is “excited to expand Poland’s role in the global semiconductor supply chain”. Intel’s largest research and development center in Europe is located in the Polish city of Gdańsk, where it employs approximately 4,000 people.

The Polish government did not immediately answer questions about how much it would pay Intel to build its plant in the country.

Intel declined to say how much of the subsidy it would receive from Warsaw, but said that, “Like all places where it operates, Intel will pursue appropriate incentives . . . to ensure that its operations continue to operate around the world.” Level competitors”.

A person close to Intel Chief Executive Pat Gelsinger, who was in Wroclaw on Friday, said he would travel to Berlin for continued talks with the German government, after a short stop in Gdansk.