The centre will enable companies in Europe, from major organisations to startups, to use AI in processes ranging from design to robotics via "secure" IT infrastructure on the continent, Germany's biggest telecoms operator said.
The move marks an attempt by Europe to make up lost ground in the battle for AI dominance, with the United States and China currently in the lead.
It also comes amid a growing focus in Europe on so-called "data sovereignty" -- ensuring citizens' and industrial data is stored at home, where it can be protected under local laws, rather than handed over to foreign tech firms.
"Germany's engineering and industrial strengths are legendary, and now it's being supercharged by AI," said Nvidia CEO Jensen Huang at a Berlin launch event for the project, which is due to go live in the first quarter of 2026.
Industry in Germany, Europe's biggest economy, is especially concerned about speeding up adoption of AI to ensure it can keep pace internationally.
Deutsche Telekom boss Timotheus Hoettges said that "AI is a huge opportunity" at a time Germany, which has been mired in recession for two years, was facing challenges. "It will help to improve our products."
- 'Data protection' -
The centre, based in the southern city of Munich, will be powered by thousands of Nvidia's advanced AI chips and provide about 50 percent more power for AI in Germany, according to Deutsche Telekom.
The telecommunications operator is providing the physical infrastructure while German firm SAP is supplying the software platforms, including AI technologies, to run the site.
The centre will "guarantee the highest standards of data protection, security and reliability", Deutsche Telekom said.
German industrial conglomerate Siemens, a partner in the project, said it will use the new centre to boost its own AI capabilities and to offer enhanced software services to clients.
Its customers like auto giants Mercedes-Benz and BMW will be able to conduct complex AI-powered simulations to help develop their vehicles, Siemens said.
Europe has in recent times stepped up its AI efforts.
The continent's fastest supercomputer Jupiter was inaugurated in September in Germany, with researchers saying it could boost efforts to train AI models.
Worries about "data sovereignty", and particularly an overreliance on US tech giants, have escalated since US President Donald Trump returned to the White House this year.
Ties have frayed between the United States and Europe across a range of issues, including EU tech regulations, which Trump has repeatedly criticised.
In September, SAP called on Europe to catch up with the United States and build up its digital capabilities, stressing it was important that firms on the continent could rely on local IT services.
"We cannot wait five years," SAP board member Thomas Saueressig said. "Europe is far behind."
Volkswagen to develop own assisted driving chip in China
Shanghai (AFP) Nov 5, 2025 -
Germany's Volkswagen said on Wednesday it would develop an in-house assisted driving chip for its business in China as it seeks to recover from sagging sales in the world's largest auto market.
Volkswagen is still the leading foreign group operating in China but the auto giant's sales have drooped as local brands rise. It is also seeking to insulate itself from global tensions over semiconductors.
The group announced a series of new electric and hybrid vehicles in April and an assisted driving system designed specifically for the Chinese market in an effort to counter that slide.
"We are accelerating and deepening the implementation of our 'In China, for China' strategy -- moving beyond localised production to mastering the core technologies that shape tomorrow's mobility," Ralf Brandstatter, CEO of Volkswagen Group China, said in a news release on Wednesday.
It is the first time the Volkswagen Group has developed its own in-house chip of this sort, a spokesman said.
Responsibility for its design and production will lie with a joint venture between CARIAD, Volkswagen's software company, and Chinese technology company Horizon Robotics.
Smart driving capabilities have emerged as a key battleground in China's cut-throat domestic auto market.
Semiconductors have also increasingly become the target of global trade tensions, in particular between the United States and China.
Washington has steadily expanded export controls in recent years, particularly in advanced chips and digital infrastructure.
European automakers have also been rocked by a row between China and the Netherlands over Nexperia chips, which despite being relatively simple in technology terms are nonetheless crucial as vehicles rely more on electronics.
Volkswagen's aim with the new chip is "taking control of a key technology that will define the future of intelligent driving", CEO Oliver Blume said in the news release.
"This marks the next logical step in our strategy for outstanding long-term innovation capabilities."
The chip is expected to be delivered within the next three to five years, the release said.
Asked whether there were plans to eventually use the chip outside the Chinese market, a spokesman said the focus was currently on "localised implementation".
"Looking ahead, we will align with the Group's overall strategic roadmap to feed technological achievements from China back into the global business," he said.
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