Intel reportedly lands on Magdeburg for European chip fab site

Intel has met with several European leaders on where the plant should go.

Screengrab via Intel

German state media group MDR reports that Intel has chosen the German city of Magdeburg over several other sites for its large-scale mega-fab.

Despite seemingly being leaked, the official announcement of the Intel mega-fab location is still set for next week, according to MDR, so take this with a dose of skepticism. It is reported that Intel chose Magdeburg over several other cities, most notably Dresden. Hubert Lakner, head of the Fraunhofer Institute for Photonic Microsystems rallied for Dresden, citing its superior infrastructure but was apparently unsuccessful in luring the company. MDR also reports that 1,000 jobs will become available at the Magdeburg facility.

The decision to plant roots in Magdeburg could have partially been based on the city’s “attractive commercial areas and because the university trains new IT talent,” according to the report. But a potentially larger player in the decision is the geographical location of Magdeburg.

Intel CEO Pat Gelsinger toured Europe in 2021, meeting with E.U.-based chip manufacturers, economic ministers, and governors along the way. During these meetings, Gelsinger was quoted as having a potentially larger interest in Germany.

“Geopolitically, if you’re in Europe, you want to be in continental Europe,” Gelsinger told Politico via Reuters. “We think of Germany as a good candidate – not the only, but a good candidate – for where we might build our fabrication capabilities.” 

Gelsinger spoke more plainly about Intel’s needs when it comes to a proper chip fab site in an earlier interview with Fortune.

“I need ground, I need a big plot, I need energy, I need talent, and I need water supply,” Gelsinger told Fortune in Sept. 2021.

While MDR is confident in Magdeburg being the location of Intel’s E.U. mega-fab, nothing has been confirmed by Intel as of this article’s publication. Regardless of location, Intel is aggressively enacting its new IDM 2.0 strategy that sees the company design and manufacture its own chips as well as provide third-party foundry services. A key part of the new, fully integrated model is to expand with a European facility.