On Monday, June 19, 2023, German Chancellor Olaf Scholz signed the biggest-ever check to a foreign company in Germany. Ten billion euros to help American electronics manufacturer Intel build a semiconductor plant in the city of Magdeburg, between Berlin and Hanover. The site will employ 3,000 people directly, with a further 7,000 workers employed for construction.

This represents a subsidy of €1 million per job created, a folly in the eyes of many economists, but the price Europe has to pay if it intends to stay in the technological race. France has done the same, granting €3 billion in subsidies for a plant in Grenoble owned by STMicroelectronics and industrialist GlobalFoundries, which will employ 1,000 people (excluding construction) –that's around 40% of the total investment.

The stakes are the same as those driving Joe Biden to release $50 billion (€46.2 billion) to make chip factories flourish in the Arizona desert and in Ohio, reducing dependence on Asia in the manufacture of the most strategic building block of modern industry: the semiconductor. Semiconductors drive everything from telephones to cars and are at the heart of the new wave of artificial intelligence that demands ever more powerful computers for training.

It is a unique opportunity for Intel, the ex-king of electronics dethroned at the turn of the 2010s by smartphone masters such as Apple or, more recently, artificial intelligence components such as Nvidia. Its new CEO, industry veteran Pat Gelsinger, was brought back in 2021 to resurrect the group. He is counting on its colossal resources to catch up with the only two companies in the world capable of producing the latest generations of chips: South Korea's Samsung and Taiwan's TSMC.

Intel will invest over $100 billion in new factories in the US, Europe and Japan. It's a gamble on industrial gigantism, carefully spread across the planet and supported by governments eager for technological sovereignty in the face of Chinese ambitions, as he explained to Le Monde.

This interview has been edited for clarity and brevity.

Nvidia is doing extremely well. The space of AI and Chat GPT has clearly driven a huge acceleration in the overall need for computing. And some of that is benefiting us, like AI PC. But Intel also hopes to be a manufacturer for those products as well. So as I would call it two bites of the apple: I hope to be a manufacturer for Nvidia as well as delivering products that compete with the AI segment of the marketplace overall.

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