Intel gives up plans for factory in eastern Germany

The Intel logo can be seen at the headquarters of the chip company. Andrej Sokolow/dpa

Intel is abandoning its billion-euro plans for a factory in Magdeburg in eastern Germany, the struggling US chipmaker announced on Thursday.

Planned projects in Germany and Poland are to be discontinued in order to optimize production capacities, Intel said in a statement.

"Intel is taking action to optimize its manufacturing footprint and drive greater returns on invested capital. As part of this effort, Intel will no longer move forward with planned projects in Germany and Poland," the statement read.

No further details were initially given.

Intel had announced the construction of initially two chip factories in the state of Saxony-Anhalt. The ground-breaking ceremony was originally planned for 2024.

Around 3,000 jobs were to be created. The investment was estimated at around €30 billion ($35.2 billion). The German government had promised state aid totalling €9.9 billion for the relocation.