Intel to invest up to 80 billion euros in boosting EU chip capacity-CEO

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FILE PHOTO: Intel CEO Pat Gelsinger attends an international business leaders' meeting in Versailles, France
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By Stephen Nellis and Victoria Waldersee

(Reuters) -Intel Corp on Tuesday said it could invest as much as 80 billion euros in Europe over the next decade to boost the region's chip capacity and will open up its semiconductor plant in Ireland for automakers.

Intel CEO Pat Gelsinger, speaking at Munich's IAA auto show, also said the company would announce the locations of two major new European chip fabrication plants by the end of the year.

There is speculation about possible production sites, with Germany and France seen as leading contenders while Poland, where Intel also has a presence, also in the picture.

The CEO said the aim was for a "total project of 80 billion euros ($94.77 billion) over the next decade that would be a catalyst for the semiconductor industry... a catalyst for the entire technology industry."

Intel, the biggest maker of processor chips for PCs and data centres, in March said it planned to open up its chip factories for outsiders to use.

Gelsinger told Reuters in April https://www.reuters.com/technology/intel-talks-produce-chips-automakers-within-six-nine-months-ceo-2021-04-12 that the company wanted to start producing chips for automakers within six to nine months to help alleviate a shortage that has disrupted vehicle production around the world.

It is unclear whether the latest announcement means Intel will meet that goal.

"Cars are becoming computers with tires. You need us and we need you... The aim is to create a centre of innovation in Europe, for Europe," Gelsinger said.

The "Intel Foundry Services Accelerator" is aimed at helping automakers learn to make chips using what Intel calls its "Intel 16" chip manufacturing technology and later move to its "Intel 3" and "Intel 18A" technologies.

Those manufacturing processes would be far more advanced than most of the processes currently used in the automotive industry. Intel said that nearly 100 automakers and key suppliers - including BMW AG, Volkswagen AG, Daimler AG and Bosch - had expressed support for its programmes. An Intel spokesman declined to confirm whether any had committed to becoming customers.

Gelsinger has been quoted saying Intel wants the EU to commit state aid to Intel's proposed European investment drive.

Intel views automakers as a key strategic priority. Gelsinger said Tuesday that the company believes chips will make up 20% of the cost of vehicles by 2030, a five-fold increase from 4% of the cost in 2019.

($1 = 0.8442 euros)

(Reporting by Stephen Nellis in San Francisco; Victoria Waldersee in Munich; editing by Richard Pullin, Douglas Busvine and Jane Merriman)

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