How A Supermarket Took Over Europe’s AI Industry With Industrial Capital

Schwarz Group, the owner of Lidl and Kaufland, is building a €11 billion AI data center near Lübbenau in eastern Germany without government subsidies, according to Thorsten Meyer AI and the industry publications it cited. The planned 200-megawatt facility, designed to accommodate as many as 100,000 graphics processors, represents a major private-sector attempt to expand Europe’s domestic computing capacity.

The project is being developed through Schwarz Digits, the retail group’s technology division, on the site of a former coal-fired power plant in Brandenburg. The reported commitment comprises about €2.5 billion for construction and €8.5 billion for technology, although the final equipment mix and purchasing schedule have not been disclosed.

Plans call for the first module to begin operating by the end of 2027. The facility is expected to use electricity from renewable sources and eventually support up to 100,000 GPUs. That figure describes its intended maximum capacity, not hardware already purchased or installed.

The investment is more than five times Schwarz Digits’ reported annual sales of about €1.9 billion. Its parent company has far greater resources: Schwarz Group records roughly €175 billion in annual revenue, employs about 575,000 people and operates across 32 countries. That financial base allows the technology division to pursue a project far beyond its own current revenue.

Private Capital Builds AI Capacity

The Lübbenau development tests whether large European industrial groups can finance computing infrastructure on a scale usually associated with American technology companies or state-backed programs. Europe has sought more control over the cloud capacity and processors used by its businesses and public institutions, amid concerns about dependence on non-European providers.

Schwarz Group’s ownership structure is central to the strategy. The retailer is controlled through entities associated with founder Dieter Schwarz and is not publicly traded, giving management more room to fund a long-term infrastructure project without quarterly pressure from outside shareholders. Germany has other foundation-linked companies, including Bosch and Zeiss, but few combine comparable capital, operational data and an established cloud-computing division.

Retail Infrastructure Meets Sovereign Cloud

Schwarz Digits was formed as a standalone division in September 2023, bringing together the group’s technology operations, including the STACKIT cloud platform and cybersecurity company XM Cyber. STACKIT had already spent roughly seven years developing infrastructure reported to include 20,000 servers and 22.5 petabytes of storage.

The group also brought experience operating systems used across billions of retail transactions. Its services carry certifications and controls associated with BSI C5, ISO 27001, SOC 2 and the EU’s DORA rules, according to the source material. Those credentials may help Schwarz Digits pursue customers in regulated European sectors, where data location and supplier oversight influence purchasing decisions.

The private financing contrasts with Intel’s planned semiconductor factory in Magdeburg. Intel had negotiated approximately €9.9 billion in German state support before the project was cancelled in July 2025, according to the supplied reporting. The comparison highlights different financing models, although a data center and chip factory involve different technologies, markets and construction risks.

“Europe’s sovereignty didn’t get nationalised — it got privatised.”

— Thorsten Meyer AI

Demand and Hardware Plans Undisclosed

It is not yet clear how many GPUs Schwarz has contracted to buy, which manufacturers will supply them or how quickly the site can approach its 100,000-GPU ceiling. No customer roster, pricing structure or expected utilization rate was provided in the source material, leaving the project’s commercial demand difficult to measure.

The project also does not eliminate dependence on imported processors, networking equipment or software. STACKIT reportedly has a five-year exclusivity arrangement connected with the wider strategy, but the precise scope and customer effects were not detailed. Schwarz Group’s private ownership permits patient investment while providing less public financial disclosure, creating uncertainty around cost overruns and returns.

First Lübbenau Module Due 2027

Construction progress and equipment contracts will be the next measurable tests. Schwarz Digits plans to activate the first data-center module by the end of 2027, when customers, available computing capacity and initial workloads may become clearer.

Attention will also turn to whether STACKIT can attract enough external customers beyond Schwarz Group’s retail operations. The site’s impact on European AI will depend less on its announced maximum size than on the hardware actually installed, the workloads it runs and the terms offered to businesses and public agencies.

Key Questions

Who is building the Lübbenau AI data center?

Schwarz Group, the owner of Lidl and Kaufland, is developing it through its technology division, Schwarz Digits, which operates the STACKIT cloud platform.

How much will the project cost?

The reported commitment is €11 billion: approximately €2.5 billion for construction and €8.5 billion for technology. Detailed contracts and final costs have not been published.

Is the German government subsidizing the facility?

The supplied reporting says the project is receiving no government subsidy. It is being financed through Schwarz Group’s private balance sheet.

Does this make Europe independent in AI?

No. The facility could expand European-controlled computing capacity, but it may still rely on foreign-made processors and software. Customers would also remain dependent on Schwarz Digits as an infrastructure provider.

When will the data center begin operating?

The first module is scheduled for the end of 2027. The timetable for reaching the planned 200-megawatt capacity has not been disclosed.

Source: Thorsten Meyer AI