Intel Corp. today announced plans to build two cutting-edge chip fabs in Germany at a cost of more than €30 billion, or $32.75 billion.

The plan extends an initiative Intel first detailed early last year. That original initiative would have also seen the company build two fabs in Germany, but with a lower initial investment of €17 billion. According to Bloomberg, Germany originally agreed to provide €6.8 billion worth of incentives for the project.

Intel is said to have begun building the fabs last year, but paused construction due to economic headwinds. The chipmaker reportedly decided to resume the project with the increased €30 billion budget after receiving additional incentives from Germany. According to Bloomberg, the total value of incentives Intel is poised to receive now stands at about €10 billion.

The two fabs the company is building are located on a nearly 2,500-acre campus near Magdeburg, the capital of the Saxony-Anhalt state in Germany. Intel estimates the site has room for up to eight chip fabs. Additionally, the chipmaker has stated that partner companies could also set up facilities on the campus, which is to be known as Silicon Junction.

“Building the ‘Silicon Junction’ in Magdeburg is a critical part of our strategy for Intel’s growth,” said Intel Chief Executive Officer Pat Gelsinger.

Intel detailed today that the fabs will be equipped with “more advanced Angstrom-era technology” than originally planned. Intel uses the term Angstrom to describe an upcoming chip manufacturing process it first detailed last year. The processor, which is set to come online in the first half of 2024, will bring significant technical advances.

Angstrom-era performance

Intel’s Angstrom manufacturing process is expected to introduce two main innovations. The first is a technology called PowerVia that allows electricity to flow more efficiently to a processor’s transistors. Additionally, Intel’s Angstrom chips will feature a new transistor design known as the gate-all-around, or GAA, architecture.

Under a microscope, a processor comprises numerous layers stacked atop one another. Usually, the processor’s transistors are located at the bottom layer. Above are tiny wires that deliver electricity to the transistors and move data between different sections of a chip for computing purposes.

According to Intel, Angstrom-era processors based on its PowerVia technology will be constructed differently. The bottom layer of such chips will comprise not of transistors but rather power delivery wires. The transistors will be located above the wires, while the interconnects responsible for moving data between different parts of a chip for processing will be in the top layers.

Intel expects the technology to speed up its processors. Recent testing has demonstrated PowerVia can deliver a 30% reduction in voltage droop, a phenomenon involving sudden voltage changes within circuits that hurts performance. Moreover, PowerVia reduces the distance that data has to travel between transistors, which also speeds up processing.

The other major innovation in Intel’s Angstrom chips will be the introduction of the GAA transistor architecture. A transistor represents ones and zeros in the form of electricity. The GAA architecture makes it possible to manipulate the electricity within a transistor more efficiently, which speeds up processing.

Fab investments 

Intel expects that the first of the two chip plants it plans to build in Germany will come online within four to five years of receiving the necessary regulatory approvals. The European Commission, the European Union’s executive branch, must sign off on the incentive package Germany has agreed to provide for the project.

The fabs are part of a broader plan to build new chip facilities in the EU that Intel first detailed last year. As part of the same plan, Intel last week announced that it will construct a new semiconductor assembly and test facility in Poland. The latter project is valued at $4.6 billion.

Intel is also adding more chip manufacturing capacity elsewhere. On Sunday, it announced plans to build a new fab in Israel at a cost of $25 billion. That sum includes a $10 billion investment that was originally announced in 2021 and $15 billion worth of new commitments.

Image: Intel