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The European Commission has launched a call for tenders to publicly finance up to seven AI gigafactories in Europe, as Brussels races to build sovereign infrastructure to train advanced AI models and catch up with global tech competitors.
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AI gigafactories are large-scale computing facilities equipped with state-of-the-art, highly specialised chips designed to train the next generation of AI technologies – notably the most advanced large language models, which require crunching trillions of data points.
The move forms part of a broader tech sovereignty push to cut the EU’s dependence on foreign suppliers of cloud services and chips.
The global race to build ever more powerful models, with their promise of breakthroughs in both economic and military terms, has triggered a parallel scramble to build the infrastructure underpinning them. Massive data centre projects are already well underway in the US and China.
In response, European Commission President Ursula von der Leyen announced a plan to build AI gigafactories in Europe at the AI Action Summit in Paris in February 2025, with the ambition of replicating the success of the CERN laboratory in Geneva.
Since then, the initiative has drawn considerable interest from industry, with 76 potential consortia expressing preliminary interest in submitting a project proposal.
To cater to that appetite from the private sector while ensuring a reasonable geographical spread of infrastructure, the Commission has expanded its initial scope from four or five gigafactories to up to seven.
At the same time, the Commission has drawn criticism for repeatedly delaying the initiative, slowing Europe to a pace that undermines its own rhetoric about the urgency of catching up with the US and China.
The procurement process has already been split into two consecutive phases, with a staggered approach designed to build up capacity gradually over the next six and a half years.
The phasing of the approach is largely down to a shortage of available funding. Having initially appeared committed to a €20 billion fund for the gigafactories, the Commission has gradually scaled back its financial commitments.
The public funding share of the project was reduced to roughly a third of the overall investment, with the remaining two-thirds to come from the private sector – and of the EU’s third, only half will be provided by Brussels, with the remainder issued by supporting EU countries.
As a result, Brussels is set to contribute roughly €5 billion, matched by another €5 billion from European governments, alongside around €20 billion in private investment.
Under the current budget, however, Brussels can only commit €1 billion, with the rest expected to come from the next Multiannual Financial Framework (MFF) – itself still a moving target, as it remains the subject of intense negotiations among member states.
“We cannot pre-empt the decisions about the next MFF. We gave you our best estimate of how much money we would have from the next MFF to be able to support phase two,” a senior Commission official said.
In exchange for their public contribution, the EU and the supporting member states will receive a proportionate share of compute access to allocate to public projects, research centres and AI labs of their choosing.
All operating costs will fall on the private actors involved, with EU officials insisting the projects must be financially sustainable by developing their own commercial services, given that access to AI compute remains scarce and valuable.
Massive infrastructure projects of this kind have attracted criticism in the past, as they tend to favour member states with the deepest pockets.
Ten countries have expressed interest in hosting a gigafactory: Germany, Italy, France, Poland, Czechia, Denmark, Finland, Greece, Portugal and Spain. Both single-country and multi-country consortia are possible, and Paris has already signalled it intends to do it alone.
Another recurrent criticism is that while the gigafactories aim to build sovereign European infrastructure, the EU remains heavily reliant on foreign suppliers for specialised AI chips.
In this regard, the Commission has signed memoranda of understanding with three chipmakers: Nvidia, AMD and Qualcomm. Among the criteria to assess the tenders are also measures to avoid potential lock-in effects from suppliers.
“We’re very aware that we wish to build up Europe’s capacity, but we also need to recognise, at the same time, that we want to do some AI right now. So, it’s about striking the right balance,” a senior EU official said.
The successful projects are expected to begin physical construction of the gigafactories at the start of 2027, with facilities due to become operational by mid-2028.
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