Intel delays chip factory in Germany

Intel Corporation. will postpone construction of its planned chip manufacturing plant in Germany and seek additional government subsidies, the Volksstimme said, which could jeopardize Europe’s aspirations to play a larger role in the semiconductor market.

Earlier this year, the American chip maker announced plans to build a €17 billion ($18 billion) megasite in Magdeburg. Construction was due to start by mid-2023, with the government planning to provide €6.8 billion in state aid.

According to the Volksstimme, the cost has risen to 20 billion euros. According to a report released on Saturday, Intel no longer has a scheduled start date for construction and wants the German government to increase subsidies.

While Intel hasn’t made any official announcement about the delay, a statement Saturday said “a lot has changed” since the company unveiled construction plans for Magdeburg. “Geopolitical concerns have become more serious, demand for semiconductors has declined, and inflation and recession are undermining the global economy,” the statement said.