Germany wins big as Intel spreads chip investment across six EU countries

The plan is the latest big investment announcement by a major semiconductor maker as the industry tries to catch up with a boom in demand for chips.

Intel has picked Germany as the site for a huge new chipmaking complex, giving the first details of a $88 billion investment drive across Europe, which is striving to cut its reliance on imports and ease a supply crunch for manufacturers.

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The plan is the latest big investment announcement by a major semiconductor maker as the industry tries to catch up with a boom in demand for chips used in everything from smartphones to cars, though there will be no quick fix as the new German plants won't come online until 2027.

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The U.S. chipmaker is spreading its investments in Europe around half a dozen countries, including boosting its existing factory in Ireland, setting up a design and research facility in France, and a packaging and assembly site in Italy.

The initial spending will total 33 billion euros ($36 billion), including 17 billion euros in Germany, where the auto industry is likely to be a prime customer for cutting-edge chips that could use technology as small as 2-nanometers.

German automaker Volkswagen highlighted the pain caused by chip shortages on Tuesday, saying it sold 2 million fewer cars than planned last year due to the issue.