Europe Unveils US$35 Billion AI Gigafactory Plan

Written by Martin Lynch, European News Editor for IIR News Intelligence (Sugar Land, Texas)

Summary

The European Union (EU) has unveiled its plan to generate 30 billion euro (US$34.7 billion) in state and private funding to create seven artificial intelligence (AI) gigafactories in Europe.

Constructing seven artificial intelligence (AI) gigafactories in Europe is the goal of the European Union's (EU's) 30 billion-euro (US$34.7 billion) plan to ensure it does not get left behind in the ongoing AI race. 

The AI Race

The European Commission (EC) revealed a plan in which it will contribute 10 billion euro (US$11.6 billion), with the remaining 20 billion euro (US$23.2 billion) coming from private investors to create a network of AI gigafactories that will help reduce the region's current dependence on U.S.-led AI technology. The Commission stated that the AI Gigafactories will combine advanced AI processors, software and cloud technology stacks, high-speed connectivity and energy-efficient data centres. Europe wants to develop advanced AI on its own infrastructure, which will follow EU standards on data protection, safety, security and ethics. "Together with Europe's network of 19 AI factories they will strengthen Europe's technological leadership, resilience and strategic autonomy," it claimed. No details on potential locations or investment partners are available yet. According to Industrial Info Resources data, there are six active AI gigafactory projects in Europe worth almost US$7.4 billion in investment. The EC is accepting proposals until November. 

Broad Support

Chipmakers AMD, ​NVIDIA and Qualcomm have all signed letters of intent to provide chips to groups involved in the projects, according to the Commission. It said that access to large-scale sovereign AI infrastructure is becoming increasingly important for Europe's industrial competitiveness and technological sovereignty. Eighteen Member States have signed agreements with the European High Performance Computing Joint Undertaking (EuroHPC JU) to jointly procure compute access time from the selected AI Gigafactories. There was no mention of how much capacity will be kept for European use and how much will be allowed for use by large U.S. firms like Google and Microsoft.

The Proposal

The Commission will back two consecutive development phases and two lots. The first lot will support up to four projects, each eligible for up to 100 million euro (US$115 million) in EU funding in phase one and up to an additional 400 million euro (US$460 million) per project in phase two. Each Gigafactory selected in this lot must deploy at least as many of the most advanced AI processors as are currently installed in Europe's most powerful AI factory. In phase two, capacity must increase to at least three times that level. The second lot will support up to three projects, each eligible for up to 200 million euro (US$230 million) of EU funding in phase one and up to an additional 800 million euro (US$920 million) per project in phase two. Each Gigafactory selected in the lot must deploy up to twice as many of the most advanced AI processors as are currently installed in Europe's most powerful AI factory. In phase two, capacity must increase to at least four times that level. The call for proposals closes on 12 November 2026.

Henna Virkkunen, the EC's Executive Vice-President for Tech Sovereignty, Security and Democracy, said: "The opening of the AI Gigafactories call represents a milestone in our AI Continent ambitions. Access to the raw scale of computing power within AI Gigafactories is a strategic necessity for Europe as AI development accelerates. I am pleased to see Member States, industry and the Commission coming together to work on these facilities that are key to our technological sovereignty."

Key Takeaways

• The European Union (EU) intends to raise 30 billion euro (US$34.7 billion) to build seven artificial intelligence (AI) gigafactories in Europe. 
• The European Commission said that it will put up 10 billion euro (US$11.6 billion) with the remaining 20 billion euro (US$23.2 billion) coming from private investors.
• Industrial Info Resources is tracking 6 active AI gigafactory projects in Europe worth almost US$7.4 billion in investment. 

About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 Trillion (USD).