Thursday, February 9th 2023
Intel Asking Germany for More Money, Set to Potentially Invest in Vietnam
To date, Intel has been promised almost €6.8 billion in subsidies from the federal German government, but apparently this isn't enough for Intel, as the company is now asking for an additional €3.2 billion, for a total of €10 billion is subsidies for its Magdeburg fab. The total investment in the fab in Magdeburg—which was announced back in March 2022—is said to be around €33 billion. In other words, Intel is asking Germany to pitch in almost a third of the cost for its shiny new fab. According to an Intel spokesperson quoted by the Register, Intel is worried about the current geopolitical situation and that the demand for semiconductors has declined, plus the fact that inflation has made everything much more expensive. Intel's Arizona fabs ended up costing an extra US$5 billion, which is about a third extra compared to the original cost estimate, so it's not hard to see why Intel is asking for more money here.
At the same time, the Vietnamese government jumped the gun and announced that Intel is looking at investing US$3.3 billion in the country, as part of an announcement of investments of a total of US$7.4 billion in Ho Chi Minh, by foreign companies. The additional US$4.1 billion investments apparently hinges on Intel's investment in the country, more specifically in the Saigon Hi-Tech Park. The official stance from Intel is that "Vietnam is an important part of our global manufacturing network, but we have not announced any new investments." It's unclear what the exact plans are, but Intel is said to have met up with government officials in Vietnam, according to Bloomberg. It's likely that it would be some kind of chip packaging facility, much like what Intel and AMD already has in Malaysia and China, among other places.
Sources:
The Register (Magdeburg), The Register (Vietnam)
At the same time, the Vietnamese government jumped the gun and announced that Intel is looking at investing US$3.3 billion in the country, as part of an announcement of investments of a total of US$7.4 billion in Ho Chi Minh, by foreign companies. The additional US$4.1 billion investments apparently hinges on Intel's investment in the country, more specifically in the Saigon Hi-Tech Park. The official stance from Intel is that "Vietnam is an important part of our global manufacturing network, but we have not announced any new investments." It's unclear what the exact plans are, but Intel is said to have met up with government officials in Vietnam, according to Bloomberg. It's likely that it would be some kind of chip packaging facility, much like what Intel and AMD already has in Malaysia and China, among other places.
43 Comments on Intel Asking Germany for More Money, Set to Potentially Invest in Vietnam
1/3 of the building cost ...
Ok, economics in this are should grow, many workers, partners ... taxes (if they pay some ... ).
But when the situation will goes bas, they won't hesitate to closed the factory, and laid all the workers.
There is many example in France, factory asks for public funds to rise up (Continental, Ford ...) and then shut the doors.
It's not the same scale, but when I started my little lab (of 2 persons :) ) nobody gaves me a $/€ !
Keep the $$ and give intel the universal finger salute
Intel has highly paid consultants telling the German State about the "economic multiplier" effect of building the fab in Dresden. Local jobs. Contracts to German suppliers etc. Learning of methods. etc. They then present it as a $x billion cost, but with a 10 year benefit of $x times 3. Only a fool believes that shark. But the gvt is riddled with gullible fools.
Just like 99% of all US companies investing in Germany, they will have internal transfer price costs, taking away all profits and redistributing them elsewhere, so the German Federal State will earn ZERO tax revenues.
So this is a test: German gvt goes for it... they are fools, again. They don't go for it... they are beginning to wise up to the US nefarious ways. Popcorn please und ein bier.
I don't understand why Intel picked Germany over France it was obvious even 5 years ago France would be a better pick when it comes to energy prices.
Germany is ********** when it comes to energy and it's only got worse with the US's actions concerning russian gas.
So yeah coughing up the extra billions is what germany will have to do if they want intel to build a fab.
It would be far cheaper than somehow building out a true european semiconductor manufacturer (which would be better, but that would take at least 15 years before it starts making something of value)
Politicians are not idiots. Rather, it's a way for them to benefit themselves personally, whilst waving their hands at the fiscal debts, passing on the cost to the taxpayer, without it being obvious. Pure corruption.
But anyway, we're going to see a big bust from the whiplash of heavy and miscalculated investment in the field during the pandemic at the same time as an economic downturn and reduced consumption so who cares.
I could go wrong, but i think it can scare many big industries to produce in France, syndicate is strong and often angry (for good or bad reasons, depends)
When multimillionaires bosses of top industries reunites in some restaurant, they talk about their cars, house, leisures and stuffs, and they spread the word : don't go to France ! :D
Seems they're doing some kind of talking to raise the auction, and get the best bidder ...
However, as says Wikipedia, they're now a Dutch company with HQ in Switzerland, which probably means that their revenue crosses so many borders and mountains that no one knows where it's gone eventually.
Intel is basically going door to door with its hand out, demanding money, and I guarantee they want that money with no strings attached, so that they can immediately throw out the work force at any moment if the stock price goes down a few percentage points.