The largest investment made by a firm in Israel to date, Intel Corp (INTC.O) announced on Tuesday that the Israeli government has granted the company a $3.2 billion grant for the new $25 billion chip facility that the company intends to build in southern Israel.
The announcement is a significant show of support from a significant American corporation and a kind offer from the Israeli government at a time when Washington is putting more pressure on Israel to take additional actions to minimize harm to civilians in Gaza. Israel and the Palestinian militant group Hamas are still at war after Hamas attacked Israel on October 7.
An “important part of Intel’s efforts to foster a more resilient global supply chain, alongside the company’s ongoing and planned manufacturing investments in Europe and the United States,” the company said in a statement regarding its expansion plan for its Kiryat Gat site, which is located 42 km (26 miles) from Gaza, which is under Hamas control.
Under the leadership of CEO Pat Gelsinger, Intel has spent billions of dollars constructing facilities on three continents in an effort to regain its hegemony in the chip industry and to more effectively combat AMD (AMD.O), Nvidia (NVDA.O), and Samsung (005930.KS). The American chipmaker’s most significant investment in recent years is the new factory in Israel.
As part of a multibillion dollar investment drive throughout Europe, Intel intends to invest more than 30 billion euros ($33 billion) on the development of two chip-making factories in Magdeburg. To entice the largest-ever foreign investment into Germany, Berlin has promised substantial subsidies.
Intel announced in 2022 that it would spend up to $100 billion in Ohio and competitors to construct what might be the largest chip-making complex in the world. Major investment plans in the United States have also been revealed by Samsung and Taiwan Semiconductor Manufacturing Co., or TSMC.
