Germany would be preparing a package of €2 billion in subsidies to boost the semiconductor industry in the country. The information is not yet official, but the investment would be a response to the postponement of the construction of a new Intel factory in Magdeburg.
Just like the United States with the CHIPS Act and many other countries, Germany is concerned about depending on the rest of the world for semiconductor manufacturing. Tensions between the US and China and supply problems worsened by the pandemic are among the reasons we see more governments offering subsidies to boost their industries in the area.
Intel, newly benefiting from the CHIPS Act in its homeland, had plans to build a €30 billion factory in Magdeburg, in part by receiving financial incentives from the European Union. The company, however, decided to postpone the project by at least two years, due to the financial problems it has been facing.
Thus, Germany seeks to inject public money into more companies to obtain some incentive in the country’s chip production. While the €2 billion value of the subsidies is not yet official, earlier this month government representatives did invite technology companies to apply for government aid.
Elections in Germany take place in February 2025
The still unofficial information about subsidies in Germany comes from Bloomberg and the Liberty Times. The publications mention that another aspect calling into question the final value of the investment is the upcoming elections in the country.
In February 2025, the German people will elect a new leader, which will impact the direction of future investments for the country. In the current global socioeconomic climate, it is difficult to imagine that any new elected (or re-elected) person will stop investing in semiconductors, but the volume of subsidies is likely to vary.
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The German Ministry of Economic Affairs’ current plan, not yet officially released, would be to use the €2 billion in subsidies to support 10 to 15 projects in different areas. This would range from wafer production to the assembly of finished chips.
Via: TrendForce
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Source: https://www.adrenaline.com.br/hardware/alemanha-prepara-e-2-bilhoes-em-subsidios-para-industria-de-semicondutores-rumor/
