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Intel on Tuesday selected the German city of Magdeburg for its next major chip manufacturing facility, continuing a dramatic expansion aimed at reducing reliance on Asian factories for vital components.

The Silicon Valley company said it expects to build at least two semiconductor factories, valued at around 17 billion euros, worth around $19 billion, in the city in eastern Germany, reflecting a plan it announced to begin in late January. production in Ohio first time. As with Ohio, Intel said the Magdeburg site could receive close to $90 billion in funding over a decade to build additional factories, along with other investments in France, Ireland, Italy, Poland and Spain.

The German site is expected to employ around 3,000 permanent workers in addition to 7,000 workers for construction.

Intel’s move is the latest response to an ongoing process. lack of semiconductor, fueled by the pandemic, which has initially blocked automakers and other companies in Europe and the United States. The supply chain crisis has highlighted customers’ dependence on chip makers in Taiwan and South Korea, especially for the most advanced products.

Patrick GelsingerA year ago, Intel’s CEO set a goal to try to increase the US share of global chip manufacturing from 12 percent today to 30 percent in the next decade. He also said that he wanted to increase the share of Europe from 9 percent to 20 percent in the same period.

“This broad initiative will drive Europe’s R&D innovation and bring cutting-edge manufacturing to the region for the benefit of our customers and partners worldwide,” Mr Gelsinger said in a statement. “We are determined to play an important role in shaping Europe’s digital future for decades to come.”

In addition to the German factory, Intel said it will set up a new research and design center in France and invest in new research, manufacturing and foundry services in Ireland, Italy, Poland and Spain.

Mr Gelsinger also argued that government subsidies are crucial to align the costs of building new factories with those of setting up factories in Asia. He lobbied officials in the US and Europe about parallel subsidy packages that could include grants to build new chip factories, noting that government support could determine how far and how quickly Intel expands in both regions.

At the same time, Mr. Gelsinger and other Intel officials spoke with officials in at least seven countries in Europe about a potential new site. Intel now has factories in Ireland and Israel, in addition to Arizona, Oregon, and New Mexico.

Germany looked like a strong candidate, in part due to the concentration of automakers who have become key customers for chipmakers. Mr. Gelsinger posted a hand-to-hand photo with then-Chancellor Angela Merkel highlighting Intel’s Mobileye unit’s driver assistance technology at an auto industry trade show in Munich in September.

The country is no stranger to chip manufacturing. One of the main production centers is Dresden, where Infineon, GlobalFoundries and Bosch operate semiconductor factories. Magdeburg is in the state of Saxony-Anhalt, about 150 miles northwest of Dresden and 100 miles west of Berlin.

European Commission announced in February to encourage more chip production in the region a plan this requires approximately $17 billion of public and private investment in the industry by 2030. This proposal will add to the approximately $34 billion in public investment already planned.

in the United States, a package This includes $52 billion in incentives for the semiconductor industry. The two versions must be reconciled in negotiations between the two chambers of Congress.