[News] Intel’s 1nm-class Fabs in Germany Reportedly Delayed Due to Black Soil Concerns and Pending EU Subsidy Approval

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Intel has reportedly delayed its construction of Fab 29.1 and 29.2 in Magdeburg, Germany, as the new timeline now pushes the start of construction to May 2025, according to a report by tom’s Hardware, citing German media outlet Volksstimme.

However, the fabs could still become operational by late 2027 or early 2028 if the semiconductor giant expedites construction and tool installation, the report stated. The current scenario does seem challenging though, as the company has to deal with black soil removal issues and delays in subsidy approvals.

In June 2023, Intel reached an agreement with Germany, announcing the signing of an amended investment memorandum. The plan involves investing over EUR 30 billion to construct two new fabs in Magdeburg, of which the German federal government has agreed to provide a subsidy of EUR 10 billion, including incentives and subsidies from the European Chips Act and government initiatives.

Originally, construction was scheduled to begin in the first half of 2023 but was postponed to summer 2024 due to delays in subsidy approvals. Until recently, the EU Competition Authority has not yet approved the around EUR 10 billion subsidy.

The topsoil removal process, as required by law, thus, has been rescheduled to May 2025. In the meantime, Intel and the state are adjusting plans, focusing on infrastructure development and land acquisition to prepare for the delayed construction, according to the aforementioned reports.

Fab 29.1 and Fab 29.2 were initially planned to begin operations in late 2027, utilizing Intel’s 14A (1.4nm) and 10A (1nm) process nodes for specific products on Intel’s roadmap, the reports noted. Although Intel has some time to ramp up the fab even if it becomes ready by mid-2028, the schedule remains tight.

The report from Volksstimme even indicated that Intel now estimates it will take four to five years to build the two factories, with production potentially starting in 2029 or 2030.

On the other hand, regarding major semiconductor companies’ overseas expansion progress in Germany, in mid-May, TSMC confirmed that it will start construction of its first chip plant in Europe in Dresden, eastern Germany, in the fourth quarter of this year, with production expected to begin in 2027.

It is understood that TSMC’s fab in Germany will initially focus on the 22-nanometer process, mainly producing automotive microcontrollers. There is a possibility of expanding to produce more advanced chips in the future.

Read more

• [News] Intel Submits Conceptual Drawings for Fab Construction in Germany, Installing High-NA EUV Exposure Machines
• [News] TSMC Confirms Construction for Its First European Chip Plant to Commence in Q4, as Scheduled

(Photo credit: Intel)