Europe initiates the bidding process for seven AI 'gigafactories' in a €30 billion effort to bridge the gap.

      The European Commission has launched a bidding process to establish up to seven AI “gigafactories,” large computing centers designed to equip the bloc with the necessary power to train advanced AI models independently from the United States.

      This call for tenders, initiated today, represents a commitment of around €30 billion aimed at bridging the gap with American and Chinese AI capabilities. The funding model is a partnership between the public and private sectors. Brussels and member states are expected to contribute roughly €10 billion collectively, while the remaining €20 billion is anticipated from private sector investments, based on the assumption that public funds can help attract the necessary private capital for these projects.

      The scale of the initiative is intentionally vast. Each gigafactory is projected to contain at least 100,000 cutting-edge AI chips, rendering it approximately four times more powerful than the largest existing data centers in the EU, and collectively, they would more than double the AI computing capacity in the bloc.

      The term “gigafactory” represents a significant enhancement over Europe’s current investment in 19 smaller “AI factories” tied to supercomputers. The new facilities are intended to be substantially larger, designed to train the types of advanced models that are currently only within the financial reach of a select few labs in the US and China.

      There is clearly a demand for this expansion; a previous expression-of-interest round received 76 responses from consortia across Europe, with ten countries—including Germany, France, Italy, Spain, and Poland—eager to host the facilities, and France indicating it may pursue its own path.

      The motivation behind this initiative is a competitive concern. Europe has observed significant investments in AI infrastructure by both the US and China while its own companies rely on computing power from American cloud services. Henna Virkkunen, the Commission’s tech-sovereignty chief, described the substantial computing capacity as “a strategic necessity.”

      However, the ambition is not yet fully funded. Only around €1 billion of the €10 billion anticipated from Brussels has been secured, with the remaining funds contingent on the EU’s forthcoming long-term budget, the Multiannual Financial Framework (MFF), which is yet to be finalized.

      A senior official acknowledged this uncertainty openly, stating, “We cannot pre-empt the decisions about the next MFF,” and referred to the figure as a “best estimate” rather than confirmed funds.

      The timeline is constrained by this uncertainty, with plans to begin construction in early 2027 and to have the first gigafactories operational by mid-2028, a timeline that relies on budgets, locations, and supply chains synchronizing effectively.

      Historical precedents suggest caution. The gigafactory proposal was initially presented in early 2025 and has since faced numerous delays, which has frustrated key partners essential for the initiative's success.

      Additionally, there is an inherent contradiction in the sovereignty narrative. The chips needed for these European gigafactories will primarily be sourced from American companies like Nvidia, AMD, and Qualcomm, which means Europe would be relying on the very entities from which it seeks to gain independence.

      Energy costs further complicate matters. Electricity in Europe is two to three times higher than in the US or China, and the power demands of data centers are already a limiting factor that subsidies alone cannot quickly resolve.

      Critics have raised concerns over the viability of the entire model, suggesting that leasing sovereign-branded capacity based on foreign-owned hardware creates an illusion of independence without providing true sovereignty, and that Europe's main deficiency lies in chip production and models, rather than infrastructure.

      Supporters argue that infrastructure represents a crucial starting point rather than the end goal. While compute capabilities alone will not create a European equivalent of OpenAI, the lack of such facilities prevents startups in the continent from scaling their training efforts—an issue the Commission aims to address, albeit at a significant cost.

      The Commission’s stance is that progress must start somewhere. Public funding bodies would receive a proportional share of the computing capacity for research and public initiatives, with the belief that developing this infrastructure will attract talent, startups, and potentially chip manufacturing to Europe.

      For now, the bidding process is open, but much of the funding remains largely theoretical. Companies can now tender to shape Europe's AI future, with the understanding that the continent has projected €30 billion in ambition while currently securing only about one-thirtieth of that amount.