Intel plans to establish a new silicon production center for 2 nm silicon in Germany, and in the meantime, has encountered financial problems. As reported by Bloomberg, global inflation has almost doubled the production costs of this facility. Intel is increasing its production capacity while the PC market continues to stagnate due to global inflation. On the other hand, the resurgence of the corona virus in the world has led to the market being out of balance.
Intel plans to produce 2nm silicon in Germany
Intel’s decision to produce 2nm silicon in Germany was initially welcomed by local authorities, because this decision came at a time when the German automotive industry was facing a serious challenge due to a shortage of chips. Automobile factories were forced to unilaterally cancel their orders due to the shortage of chips and chipsets that was caused by the Corona epidemic.
Meanwhile, we remind you that the Taiwanese company TSMC is the largest producer of silicon in the world. This issue is important for our discussion because this company was forced to increase its production capacity more than usual in response to the needs of the automobile industry.
The idea of building a silicon manufacturing facility for Intel’s 2nm chips in Magdeburg, Germany was a brilliant idea at the time, but neither Intel nor the local authorities anticipated the future. Russia’s invasion of Ukraine increased Europe’s inflation, and following the increase in inflation, the price of energy and also the price of construction materials increased. The result of these factors has made Intel request more help from the German government to complete the construction of this center. According to the initial estimate, the construction of this center was supposed to cost 17 billion euros, but with the current situation, the cost of its construction has reached 30 billion euros.
One center out of three centers…
Intel’s silicon production center in Magdeburg, Germany is supposed to be one of the most advanced silicon production centers in the world. Intel announced last year that the center will produce 18 angstrom (1.8 nm) chips after the construction is completed. This center is actually one of the three centers that Intel wants to establish in Europe, and the second and third centers will be established in Ireland and Italy. The silicon production center located in Ireland will produce silicon based on Intel 4 nodes, and the Italian production center will be considered as a backup and reserve production line. In its initial calculations, Intel estimated that the construction of these three centers would cost 33 billion euros; While with the current conditions, this number is only the cost of building one center out of three centers.
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