Instead of Poland, Asia will be the destination. Intel changes its global plans and takes a major investment.

A year ago, Intel announced it would suspend its massive projects in Germany and Poland for two years, and now it is finally withdrawing from them. At that time, the company signed a strategic agreement with the German government, which included the construction of two semiconductor production plants. The agreement was worth $33 billion, with Germany contributing $10 billion in subsidies. In June 2023, the company announced its intention to invest $4.6 billion in the construction of a semiconductor integration and testing facility in the Miękinia commune near Wrocław. The plant, located within the Legnica Special Economic Zone, was expected to create 2,000 jobs.

Instead of Poland, Vietnam and Malaysia. Intel is focusing on Asia.

Intel has been cutting costs for a long time, and has also replaced its CEO, while the new management team, led by Lip-Bu Tan, is implementing a strategy of cost cutting and limiting infrastructure expansion. "In the future, we will take a systematic approach to expanding our factories, fully aligned with the needs of our customers. We will be prudent and disciplined in allocating capital," the CEO explained. "We have decided not to proceed with previously planned projects in Germany and Poland. We also plan to consolidate our assembly and test facilities in Costa Rica with our larger facilities in Vietnam and Malaysia," he added. Intel shares have risen 13% this year and will experience their steepest decline on record in 2024, falling 60%.

The pandemic and the resulting supply problems, including those with semiconductors from Asia, have exposed the scale of the world's dependence on Asian plants. As a result, many sectors, such as the automotive and electronics industries, have had to suspend production due to a shortage of processors, essential not only in cars but also in household appliances. Therefore, the European Commission announced a special support program for manufacturers and governments to develop chip production in the EU. The goal is a 20% global market share by 2030, and similar programs are also underway in the US.

Germany invests with TSMC. Will Europe become a chip giant?

Germany won't be mourning Intel for long; it already has more chip projects lined up. In 2024, it was announced that Taiwan Semiconductor Manufacturing Company, the world's largest integrated circuit manufacturer, had begun construction of its first European plant in early August – an $11 billion facility in Dresden. TSMC holds a 70 percent stake in the venture, called European Semiconductor Manufacturing Company, while German automotive chipmaker Infineon Technologies, Dutch NXP Semiconductors, and automotive parts supplier Bosch will each hold a 10 percent stake. The project will receive subsidies from the German government, amounting to approximately half of the total investment.