Intel’s plans to delay the EU’s largest chip-making facility would dent the bloc’s goal to produce 20% of global semiconductors, experts say
US tech giant Intel is halting construction of two chip manufacturing plants in Germany as it struggles to counter shrinking sales and mounting losses, the company’s CEO Pat Gelsinger announced on Monday.
According to Gelsinger, the project in the city of Magdeburg in Saxony-Anhalt is expected to be delayed by around two years.
The company had planned to build two chip factories in Magdeburg worth over $33 billion, creating some 3,000 jobs as part of a larger investment plan for the EU. Intel had also signed an agreement with the German government for about $11 billion in state subsidies for the project, according to the DPA news agency.
The plans, however, have been put on hold as the US tech giant struggles to reduce losses and launched a cost-saving program earlier this year. Intel also said it is postponing a new factory in neighboring Poland.
“We must continue acting with urgency to create a more competitive cost structure and deliver the $10 billion in savings target we announced last month,” Gelsinger said in a letter to employees.
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