The ambitious project was a win for Europe. Now it’s resigned to wishful thinking.
Intel has cancelled plans for a so-called megafab in Germany and a packaging plant in Poland. It also plans to shift assembly and test facilities in Costa Rica to its larger Malaysian and Vietnamese sites. The news comes from a letter to employees written by CEO Lip-Bu Tan, who says the move will help Intel in its goal of becoming a «more financially disciplined company» as it looks to cut costs company-wide.
«Going forward, we will follow a systematic approach to growing our factory footprint that’s fully aligned with the needs of our customers. We will be judicious and disciplined as we allocate capital – because that’s what great foundries do», says CEO Lip-Bu Tan.
«With that in mind, we have decided not to move forward with previously planned projects in Germany and Poland. We also plan to consolidate our assembly and test operations in Costa Rica to our larger sites in Vietnam and Malaysia. Costa Rica remains a large and important Intel site that’s home to key engineering teams and corporate functions.»
The cancellation of Intel’s megafab in Magdeburg, Germany will be a big loss for not just the local area, which was set to see tens of billions of euros invested into the area to build the advanced manufacturing facilities, known as fabs, but also the EU. Announced in 2022, the Magdeburg site was planned with hopes of becoming a world-leader in semiconductor manufacturing, delivering chips on process nodes in the ‘Angstrom era’, and aiding the EU in doubling its semiconductor market share by 2030.
The European Commission and local governments were set to invest billions of euros in the facility, though even one year later, Intel deemed the money not enough and asked for more.
