As Europe hopes to double its share of global chip production, Intel comes along with $20bn, plans for fabs Intel is planning to spend as much as $20bn on building a couple of chip manufacturing plants in Europe, with more in the works. CEO Pat Gelsinger has been traveling across the region and just met French President Emmanuel Macron, German Chancellor Angela Merkel, and Italian Prime Minister Mario Draghi to discuss component …
In this case I very much doubt that it will be Ireland.
Europe's biggest single semiconductor biz is French-Italian and Europe's biggest chip cluster is Silicon Saxony around Dresden where all the world's major semiconductor players (including Intel themselves) already have a presence).
I suspect that the Netherlands is on the shortlist because of the presence of the world's largest manufacturer of semiconductor photolithography machines. I also suspect that is not enough to be a serious draw for a fab.
My money is on Dresden, otherwise somewhere in France near both suppliers and customers.
I guess and wish it will be in the city of Leuven (Flanders +Belgium) next to Imec and KU-Leuven (Catholic University of Leuven)
“Europe has two jewels,” Intel CEO Pat Gelsinger said in an interview in May. “One is ASML, the most advanced lithography, and the other is imec, the most advanced semiconductor research in the world.”
https://www.bloomberg.com/news/features/2021-07-13/u-s-and-china-fix-their-sights-on-world-s-top-chip-research-center
Exactly. The sub-heading takes a pot-shot at Brexit. I think its possible to see the countries chosen are the set of rich EU countries able to afford the br.. the bri... the financial support. Hopefully the UK chose not to prop up Intel's shareholders. Or it will offer support terms to Intel's competitors like AMD so not all eggs are in the same basket.
Have I misunderstood, or are you referring to Brexit? If so, I don't think your reference to farmers is correct.
https://www.bbc.co.uk/news/uk-36078112
states that the National Farmers Union backed a resolution to remain in the EU in 2016, following an "overwhelming" vote of its council. Of course, the NFU had no control over how individuals voted, but famers had a clear indication of what the union considered would be in their best interests.
"Hopefully the UK chose not to prop up Intel's shareholders."
More likely, big investments like fabs are not coming to the UK until the trade situation and tariffs are more known and stable factors. If a fab was built in the UK, who knows what additional costs may be incurred importing the expensive kit and raw materials, let alone potential tariffs on exports of the product. EU trade is still up in the air for foreseeable, and there's no US trade agreement yet. EU trade is a known factor, not to mention the already talked about existing fabs and whatnot inside the EU free trade zone.
This. The uncertainty is killing for some sectors. A client of mine is currently comparing Germany, the Netherlands and Luxembourg to move to from the UK. Even all the directors are emigrating with the company and they plan for the UK entity to be dissolved before year-end.
For them the biggest problem at the moment is that nobody in the UK (not even the government) can tell you what certain regulation is going to like in two years, five years or ten years time. Whatever the regulation is going to be will be the outcome of a tug-of-war between economic nationalists, free marketers, tabloid headlines, ministers with an axe to grind, and a few airheads who, inexplicably, write influential newspaper columns.
In more stable politico-economic environments you do not know to the letter what the regulation will look like in ten years time but you will already know a direction and focus areas. That drastically limits the number of scenarios.
My client is about to raise around 20 million in their next funding round and that is almost impossible in a heavily regulated sector like theirs where the unknowns for operating in the UK are too plentiful. Which investor is going to invest in a heavily front-loaded capital intensive UK operation when there are dozens of potential regulatory scenarios?
For them the biggest problem at the moment is that nobody in the UK (not even the government) can tell you what certain regulation is going to like in two years, five years or ten years time
With Merkel on the way out, and Macron due for an election next year, I'm not sure you'll get much more certainty from Germany or France either, though. The EU as a whole is likely to go through some major economic upheavals as those changes ripple through, not to mention the current waves being made by Hungary & the Czech Republic. Diversifying across multiple countries, inside & outside the EU, can work for some things but it isn't so easy for chip fabs, which require massive investments.
Whatever the regulation is going to be will be the outcome of a tug-of-war between economic nationalists, free marketers, tabloid headlines, ministers with an axe to grind, and a few airheads who, inexplicably, write influential newspaper columns.
Not a problem restricted to the UK, I'm afraid.
I’m talking about policy stability. Here in the UK we’ve always had a bit less policy stability due to the political system. One lot comes in, spends a few years tearing up what the previous lot had created and develops its own policies. This is followed by another lot who subsequently tears up what the predecessor had built etc. etc. The Brexit process that we'll be in for the next ten years or so has only amplified that.
In coalition based political systems that are common on the Continent it’s rare for a new coalition not to feature members of the previous governments. In Germany it’s even rare to have a government without the CDU. This makes for much more gradual shifts. Even in winner-takes-all presidential systems such as France the policy shifts are always gradual. You’d need to be a serious Élysée-watcher to notice the difference in policy between Sarkozy, Hollande and Macron when looking from abroad.
And, honestly, out of the three countries my client is looking at, you don’t seriously think that either Luxembourg, Germany or the Netherlands is suddenly going to leave REACH, or the European electricity market, or the EU carbon trading system, or the European labour market, or the European Internal Market do you? Otherwise I have a bridge to sell you.
Anyway, my client has made the decision to leave the UK, the shareholders are on board and I expect to hear which country they have chosen some time in the next two weeks. Even if the UK government would be able to give a solid guarantee that no environmental and chemical regulation will change over the next ten years (which they can't) it's already too late.
The problem is that there are fifty shades of Tory.
Just look at the difference between the Cameron and the May/Johnson period. It’s almost inconceivable that Thatcher and Johnson are in the same party. Thatcher would have been appalled at the suggestion to leave the EU Single Market she created or to blow up the national debt (over 100% now) to spend on winning votes in the North.
Even if the UK has almost exclusively been ruled by the Conservative Party for the last hundred years, the dominant faction of the time makes a massive difference.
A friend of mine worked for the Conservative Party in No. 10 just a few years ago, now he doesn’t want anything to do with the current “bunch of crooks, spivs and nazis”. I doubt he’ll have terminated his CP membership as some other friends of mine have but he absolutely wishes not to be involved at the moment.
"A friend of mine worked for the Conservative Party in No. 10 just a few years ago, now he doesn’t want anything to do with the current “bunch of crooks, spivs and nazis”. I doubt he’ll have terminated his CP membership as some other friends of mine have but he absolutely wishes not to be involved at the moment."
So, how is Dominic doing these days? Any insights on the next big headline?
It doesn't really matter, they are/were all Tories following a Tory agenda and the basic agenda has nt changed. fuck the working classes and grovel to their paymasters. The BoJo Mob are no different to earlier iterations.
Thatcher was responsible fr selling off the UK to her buddies, that is standard Tory.
The Tories continue with that policy, when they can get away with it. They want to dismantle the NHS and the BBC. The former to make money for their mates the latter because the beeb doesn't act like the Mail and Express.
Thatcher and Johnson both hate "the lower orders". Standard Tory.
Maggie would have done what the Telegraph, Mail and Express told her to do, as all Tories because they want to stay in power. that was Cameron's mistake. Pissng off Dacre.
Yes, the dominant faction does make the difference. In how much they can get away with scalping the serfs.The Tories are the same as the current Trump GOP. No real morals. Only staying in power matters.
not very fillersoffical are you. There is a major difference between a country's elected leader leaving office and the shambles that is Brexit.
Yes Hungary & the Czech Republic are whimpering, as is Poland, but they know they won't do anything stupid like Brexit. We all know that the Brexiteers predicted the EU would collapse after the UK voted out, don't we and they are still trying to push their fantasy. A bit Trump and his election lies.
"Not a problem restricted to the UK, I'm afraid." Correct, but the UK suffers from it far, far more than most, other than the USA. Seems whenever the Mail prints headline the government snaps to attention and obeys.
Funny that all the brexiteers are beating about government support in EU countries when for years they categorically stated it wasn;t allowed.
It was and that is why the EU has industry and the UK has scraps. Maggie's Britain chose to shit on the "working" people and support the City. It worked, UK industry collapsed, the City thrived. Now the Brexiteers are bleating and actually expect people to care. These threads are full of bleating Brexiteers who can't accept they fucked up.
If they want sympathy, which it is obvious they do, they'll find it in a dictionary between shit and syphilis.
Forget taxes, so what if it's 30% more for billionaires... that's 3,000% more for the working people of the nation.
So what matters more, the obscenely rich staying obscenely rich, or people having jobs? Or maybe some "financial expert" will come along and tell us how the system "really works" and how well we're all doing, as the vast majority of us clearly keep spiraling down the drain. If the system "works", the system is a lie.
You seem to have missed the fact that the major players are investing big time in the EU.
Why are chips cheaper from the East? RoK, high cost of living and high wages. Taiwan, the same. so it isn't cheap labour is it. the same is true in shipbuilding. The difference is efficiency. That is why the EU is better than the UK for the planned fabs as the UK is infamous fro inefficiency.
WTO anyone? Contrary to Brexiteer lies one cannot just arbitrarily slap on taxes. On the other hand one can try and claim dumping. Won't work.
Or curb imports for ethical reasons. Works but leaves the country without what it desperately needs.
The difference in costs is mainly due to inefficiency which is why the big payers are investing in large scale production. Then there are the PRC firms helping out the the UK.
.. well of course not - they're after the 8bn subsidy, not giving a vote of confidence for the political leadership of the EU.
...who are in turn panicking over global supply chains. It looks like the new fabs will all come on line just about the time we go through the bust phase of the chip supply cycle.
“Allow the sale of”.....
Perhaps If you think it is a great commercial opportunity, you should buy it instead?
Just put together a business case, and either get a loan from the bank, or run it up as a SPAC instead.
Here’s a hint: I will not be investing my money in your SPAC
"It looks like the new fabs will all come on line just about the time we go through the bust phase of the chip supply cycle."
Well yes, that's how cause and effect generally work. The bust phase is caused by new fabs coming online, replacing the undersupply with oversupply until demand catches up again and eventually makes it worth investing in more new fabs...
Once the EU pony up the 8bn subsidy we in the uk can benefit from no increase in prices as the EU will have offset the disparity of producing in the EU vs Asia.
Intel may struggle to ship product out of the EU if there is a future shortage though. Also the intel offices could be raided and evidence seized of wrong doing if the EU decide intel are not cooperating with EU diktat.
Wake me up when TSMC decide to build a plant in the continent of Europe.
We're schooled in the long obsolete notion that Asians work for peanuts (or rice or whatever). They don't. They earn good money, comparable with the wages paid to US workers (here I mean 'workers', not executives). Land and utility costs in the US can be low, especially in states like New Mexico. So where's this "Costs 30% more" coming from?
I have always been a bit skeptical of these cost assertions because its always where I'm working that costs too much, is uneconomic and so on. I had an interesting experience that underscored this a decade or so back when I became an 'accidental Intel employee' due to an acquisition of a company I was working at in Southern California. As the relevant IP was sucked out of the company we were obviously 'uneconomic' -- the work my group was doing was eventually outsourced to Russia -- but while I was working there I had to spend a week at Intel's facility in Haifa. Israel. The working conditions there were unbelievable -- it was the free food (breakfast and lunch -- nice stuff as well, none of your prepackaged junk), the relatively short working hours compared to what I was used to. Then there was the free car -- all employees above a certain grade were eligible for a free vehicle (below this they just got a subsidy). Compared to our relatively mediocre wages, 'work all the hours God sends us and then some', the cube farm mindset.....anyway, you get the idea.
Journalists need to be skeptical of these kind of numbers, the ones that say "You're not working hard enough". I've lived with this both in the UK and the US for my entire working life. Companies have an infinite number of ways to divert profits so taking anything they say at face value is likely to get yourself conned.
Quote
"We're schooled in the long obsolete notion that Asians work for peanuts (or rice or whatever). They don't. They earn good money, comparable with the wages paid to US workers (here I mean 'workers', not executives). Land and utility costs in the US can be low, especially in states like New Mexico. So where's this "Costs 30% more" coming from?"
Speaking from the industrial plant end of the IT game, pretty much the machines cost the same where ever you are, shipping and import taxes apart, and then the primary costs are labour and power in that order.
The cost advantage in Asia is that employee protection is much laxer, along with enviromental laws.
So we have to fit lock out cages around the gear adding to the cost, and have to pay someone to recycle used oil/coolants rather than pouring them in the nearest river also adding to our running costs.
The biggest downer on what we do is is always the customers going 'I could get it made cheaper in China with the same plant" to which our response is nearly always "we give a quicker turn around(no 8000 mile ship voyage for delivery), plus you can come in and discuss your needs when its clear your designers need new crayons"(we're slightly more diplomatic than that with the last one).
“ I had to spend a week at Intel's facility in Haifa. Israel. The working conditions there were unbelievable -- it was the free food (breakfast and lunch -- nice stuff as well, none of your prepackaged junk), the relatively short working hours compared to what I was used to. Then there was the free car -- all employees above a certain grade were eligible for a free vehicle (below this they just got a subsidy).”
Back here In the UK the last Labour government tightened the rules around “perks from work”
Companies can provide free food, cars, healthcare and other perks but the employee must pay benefit in kind taxes which makes it not so attractive to the recipient.
“ We're schooled in the long obsolete notion that Asians work for peanuts (or rice or whatever). They don't.”
Outsourced technicians working from Asia often earn 8 times less than their onshore predecessors.
Check Glass door for what roles are paid in different parts of this globe.
Most countries tax "perks" and to evade the tax on them is illegal as The Former Guy knew and is now facing the music for. Perks are disguised earnings and I suspect what you are telling us only a small part of the truth.
a company car is a perk, unless your car is part of your work. Sadly some people can't work out the difference, or pretended they couldn't. i.e. tax evasion and avoidance.
If the high earners paid more into the pot rather then use tax havens, claim non-dom etc., and all companies did the same then there would be less incentive for the government to tax lower earners. Sadly no government kept in power by media controlled by the culprits will ever do that.
Years ago when I was employed by a UK company but working outside the UK I received a modest tax deduction. Modest. What benefits did I receive? Healthcare was vis company insurance for example. But I was happy to pay for what I didn't benefit from as I had benefited in the past to some extent from what others had paid. Those that live full time in the UK and evade/avoid tax are basically scum, aren't they.
Correct. The main producers are the RoK and Taiwan, both high cost countries, a fact of which most commenters see blissfully unaware.
also may commenters seem to believe "the East" means the PRC. Just read the comments.
Having lived and worked in the region for a long time I know that efficiency is the main factor. A prime example is shipbuilding. Japan and the RoK are still major shipbuilders, Taiwan slightly less so. Closer to home, The EU has major shipbuilders. The UK doesn't. How is it that these high cost countries can do what the UK can't. efficiency. Jim Venus proved the UK can do it if there is a political will, but then that vanished. End of.
Rather a lot of money is being invested in the EU auto industry as well as high tech, with a few crumbs to the UK. See above.
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