Semiwiki on LinkedIn Semiwiki on Facebook Semiwiki on Twitter Register / Log in 
Array
(
    [content] => 
    [params] => Array
        (
            [0] => /forum/index.php?threads/intel-chip-factory-billions-in-subsidies-to-be-returned-to-the-federal-budget.21409/
        )

    [addOns] => Array
        (
            [DL6/MLTP] => 13
            [Hampel/TimeZoneDebug] => 1000070
            [SV/ChangePostDate] => 2010200
            [SemiWiki/Newsletter] => 1000010
            [SemiWiki/WPMenu] => 1000010
            [SemiWiki/XPressExtend] => 1000010
            [ThemeHouse/XLink] => 1000970
            [ThemeHouse/XPress] => 1010570
            [XF] => 2021370
            [XFI] => 1050270
        )

    [wordpress] => /var/www/html
)

Intel chip factory: Billions in subsidies to be returned to the federal budget

Daniel Nenni

Daniel Nenni

Admin
Staff member
The federal government originally wanted to subsidize Intel's new chip factory near Magdeburg with around 10 billion euros. The money comes from the Climate and Transformation Fund (KTF). However, since Intel wants to pause construction for at least two years in order to save money , the billions will apparently flow back into the federal budget, which is sure to be welcomed by the Ministry of Finance in view of tight budgets. Specifically, this concerns the first tranche of 3.96 billion euros, which was planned in the 2024 federal budget.

Finance Minister Christian Lindner (FDP) had already made similar demands last week. However, the Climate and Transformation Fund serves as a financing instrument of the Federal Ministry for Economic Affairs and Climate Protection, and so Federal Minister of Economics Robert Habeck (Greens) resisted allowing these funds to flow back until the very end. Further meetings are to follow up to the coalition committee meeting on Wednesday evening.

Intel's chip factory near Magdeburg (rendering)

Intel's chip factory near Magdeburg (rendering)

The big question now is when does Intel want to make a concrete decision for or against the chip factory? If this decision is positive, how much will the federal government subsidize the construction? The previous negotiations can be thrown out and start again from the beginning. If Intel decides against a new building, what will happen to the space provided for the chip factory, which certainly cannot be used for other purposes?

At least it is unlikely to become any easier to build such a chip factory in the coming year or the year after – neither for Intel nor in terms of government subsidies.

www.hardwareluxx.de

Intel-Chipfabrik: Milliardensubventionen sollen in Bundeshaushalt zurückfließen - Hardwareluxx

Intel-Chipfabrik: Milliardensubventionen sollen in Bundeshaushalt fließen.
www.hardwareluxx.de www.hardwareluxx.de
 
One can't exactly take what was never given... Maybe Schultz intends to flow the idea of money into Germany's budget?
 
They mean the German government spending that was allocated for that will be used elsewhere.
From what I understand the site in Germany that Intel chose had issues which would delay construction of the fab shell. With cash running out Intel decided to focus on existing sites.
 
samwilde said:
They mean the German government spending that was allocated for that will be used elsewhere.
From what I understand the site in Germany that Intel chose had issues which would delay construction of the fab shell. With cash running out Intel decided to focus on existing sites.
Click to expand...

It will be interesting to see how TSMC's joint venture in Dresden progresses next year:


And I hope more joint ventures will be coming. It is a much lower risk proposition for Germany.
 
MKWVentures said:
Cancelling the Fab in Germany might be Intel's smartest decision in the last 3 years. Joint ventures are the way to go.
Click to expand...

No ventures is a way to go. All fabs of major players are already located in places with rock bottom costs, and local suppliers.

The only way to beat the location advantage is to offer a subsidy that will substantially offset, like by a few times, the local costs (utilities, labour, consumables).

As the nodes will get older, their profitability will drop. A new, latest, and greatest node may be viable in an expensive location, but it will get far less in a few years, if that fab will be standing alone in a place with no existing semiconductor industry.

That's the story of Singaporean fabs. They had to fly in all the chemicals, parts for equipment, fly equipment to Netherlands for repairs, and also flying very expensive Taiwanese consultants to do otherwise menial tasks, which would've been done by people with 2 year college back in Taiwan. And electricity, water, and spent chemical disposal costs will not get lower in a small island nation. The only way Singaporean semi could've stayed competitive would've been by constantly upgrading to new, more profitable nodes.
 
Last edited:
Paul2 said:
No ventures is a way to go. All fabs of major players are already located in places with rock bottom costs, and local suppliers.

The only way to beat the location advantage is to offer a subsidy that will substantially offset, like by a few times, the local costs (utilities, labour, consumables).

As the nodes will get older, their profitability will drop. A new, latest, and greatest node may be viable in an expensive location, but it will get far less in a few years, if that fab will be standing alone in a place with no existing semiconductor industry.

That's the story of Singaporean fabs. They had to fly in all the chemicals, parts for equipment, fly equipment to Netherlands for repairs, and also flying very expensive Taiwanese consultants to do otherwise menial tasks, which would've been done by people with 2 year college back in Taiwan. And electricity, water, and spent chemical disposal costs will not get lower in a small island nation. The only way Singaporean semi could've stayed competitive would've been by constantly upgrading to new, more profitable nodes.
Click to expand...
I have done a lot of work in Singapore. They have advanced fabs, 10 year old fabs and 20 year old fabs. All are successful even on >90nm processes. I thought The key for them is subsidies and ability to get engineers and labor from all over.... Is that not correct?
 
MKWVentures said:
I have done a lot of work in Singapore. They have advanced fabs, 10 year old fabs and 20 year old fabs. All are successful even on >90nm processes. I thought The key for them is subsidies and ability to get engineers and labor from all over.... Is that not correct?
Click to expand...
It is correct, and much of Chartered story is about double digit percentage subsidies and expensive foreign consultants.

I myself spent my early careers in Sing, 2007-2009
 
You must log in or register to reply here.
Back
Top