Intel plans US$25 billion Israel wafer fab spend

Find the Latest SoC Solutions
for... Automotive... IoT... Security... Audio... Video

Chip giant Intel will spend US$25 billion to upgrade its wafer fab site in Kiryat Gat, Israel according to reports quoting Israel Prime Minister Benjamin Netanyahou.

www.eenewsanalog.com/, Jun. 19, 2023 – 

The upcoming investment has been "agreed in principle" and the factory is due to begin production in 2027. Speaking at a televised cabinet meeting PM Netanyahou said the investment would be: "a tremendous achievement for the Israeli economy – 90 billion shekels (about US$25 billion) – the largest investment ever by an international company in Israel."

Intel has operated wafer fabs at the site for several decades and acquired the Israel automotive chip company Mobileye, which makes advanced driver-assistance systems, for $15 billion in 2017. This has helped make Intel the largest privately-held employer in Israel.

Intel will pay an increased tax rate of 7.5 percent on profits made in Israel, up from the current 5 percent, according to the Israel finance ministry.

No details were given with regard to the amount of direct subsidy Israel would provide.

A similarly ambitious plan from Intel to build wafer fabs on a similar timescale in Magdeburg in Germany, valued at €20 billion (about US$22 billion), has started to come under doubt over the size of subsidy required (see Intel's German fab in peril as politician says 'no' to subsidy).

For many years wafer fab investments typically received subsidies worth about one-third of the life-time capital expenditure. However, in recent years those subsidies have moved up to 40 percent and more as different regions are eager to secure domestic chip suppliers. At the same time governments do not want to engage in a bidding war.

Germany had planned to provide €6.8 billion towards the €17 billion cost of building two wafer fab modules at Magdeburg. Construction was due to begin in 2023 or 2024 with a view to chip production starting in 2027. Since then expected wafer fab investment has risen to €20 billion and Intel has asked the German government to find €10 billion in support (Intel delays German fab, wants more subsidy).

click here to read more...

 Back