More money can’t solve all problems for German Intel fab

Things are moving “a little slower than expected,” but Intel is still “100 percent committed” to building a fab in Magdeburg, assured Frans Scheper, general manager for the EMEA region. Intel put the project on hold a year after announcing it, asking for additional subsidies to cover increased energy and construction material costs. The issue is causing a rift in Germany’s ruling coalition.

Energy prices and related cost rises could well prove a tough nut to crack. After peaking last summer, natural gas prices have returned to pre-Ukraine war levels, but that doesn’t mean that the energy crisis is over. Even lower Russian supplies, increased demand in Asia and unfavorable weather could easily reverse the downward pricing trend. European gas futures soared 20 percent in a single June day, tentatively explained as the result of LNG suppliers starting to favor Asia over Europe.