Intel plans to invest 100 billion USD to build a chip manufacturing complex in the context of a serious shortage of the global semiconductor market.
A rendering of Intel's chip factory in Ohio. Photo: Intel |
The move is part of a strategy to restore Intel's dominance in the chip sector and reduce America's dependence on Asian manufacturing hubs.
Intel CEO Pat Gelsinger said the initial investment is worth $20 billion on a 404.6-hectare site in New Albany, Ohio (USA) and will create 3,000 jobs. In the future, this figure will increase to USD 100 billion with a total of 8 factories and will be the largest investment recorded in Ohio. "This could become the largest semiconductor manufacturing site on the planet," said Intel CEO. Construction of the first two factories is expected from the end of 2022 and production starts from 2025.
While chipmakers are trying to improve output, Intel's plan to build a new factory does not alleviate the current shortage of supply. Complexes like Intel's new investment will take years to build. Mr. Gelsinger also predicts the chip shortage problem will continue into 2023.
"China is doing everything to dominate the global market to compete with the US," US President Joe Biden told Gelsinger during an event to celebrate Intel's new investment. Meanwhile, US Commerce Secretary Gina Raimondo said the event could help the country reduce "dependence on countries halfway around the world".
In 2021, Intel has a growth rate of only 0.5%, the lowest among the top 25 US companies according to data from Gartner. In addition to its massive investment in Ohio, Intel plans to announce another major chip manufacturing site in Europe in the next few months.
Not only Intel has increased its factory expansion, other companies such as Samsung and TSMC have also announced large investment plans in the US. However, this has experts concerned about future chip overcapacity. "The industry is growing and the metaverse can handle this abundant supply. But a massive bubble in the global chip industry could still be imminent," said Alan Priestley, analyst at Gartner.
Via Reuters