Technology

Chips up for Intel as European states compete to woo the tech giant

US company’s next mega-investment seems unlikely to be Ireland-bound

Intel chief executive Pat Gelsinger on a visit to its Leixlip campus in September. Photograph: Dara Mac Dónaill

Sat Oct 23 2021 - 06:00

Is the State still in the running to land a major new Intel investment? In September, its chief executive Pat Gelsinger said the Republic – where the company has its European headquarters in Leixlip, Co Kildare – had submitted several proposals out of "about 70" received from across Europe. The chipmaker is planning two new European fabrication plants and intends to announce their location by the end of 2021.

These plans come just months after the company confirmed it will create 1,600 new jobs and doubling the manufacturing space at its existing Irish operation as part of a $7 billion (€6 billion) investment – good news in itself. But this next tranche of investments will be bigger, with the US tech giant intending to plough as much as €80 billion into European capacity over the next decade with a view to achieving a geographical rebalancing in the global business of semiconductor production.

Intel wants to avoid the kind of supply shortages that are currently forcing automotive manufacturers to slash their production targets, with a fair chance that smartphone makers will be obliged to do the same.

But as its official decision approaches, the competition appears to be on the fierce side, with Reuters reporting that Italy is drawing up an offer to convince Intel to set up an "advanced packaging" plant there, while Dresden in car-making Germany has emerged as the frontrunner to house an even bigger megafactory.

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Favourable terms

Sources told Reuters the Italian government was ready to fund part of the overall investment with public money and offer other favourable terms to Intel, including on labour and energy costs.

Nevertheless, Poland has been named as an alternative destination to Italy for the "packaging" facility, which will allow Intel to mix and match "tiles" into full chips, while France is said to be competing hard with Germany for the megafactory.

Based on the latest soundings, the Republic might just have to wait its turn. Of course, the sight of various states falling over themselves to score big with Intel should, in the meantime, make the chipmaker very happy.

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