Intel Plans To Spend $7 Billion On Factory Upgrades
The world’s largest chipmaker Intel Corp. announced its plans on Tuesday to spend $7 billion upgrading its U.S. factories over the next two years.
The investment is the company’s largest to date for a new manufacturing process.
The move comes as a surprise to many, as Intel has decided to increase capital spending despite a slow economic slump that has resulted in one of the worst PC sales markets in years.
Intel CEO Paul Otellini said the company’s decision would set an example for the semiconductor industry’s need to keep investing heavily, regardless of the economic climate.
"We’re investing in America to keep Intel and our nation at the forefront of innovation," Otellini said.
Intel said it would invest the money in the company’s 32-nanometer (nm) manufacturing technology that will be used to build faster, smaller chips that consume less energy.
"These manufacturing facilities will produce the most advanced computing technology in the world. The capabilities of our 32nm factories are truly extraordinary, and the chips they produce will become the basic building blocks of the digital world, generating economic returns far beyond our industry."
Intel recently announced it was cutting up to 6,000 manufacturing jobs by closing plants in Malaysia and the Philippines and stopping production at facilities in Oregon and California.
Some new jobs will be created as the factories are outfitted with the new gear, Otellini said, adding that Intel wanted to deploy the technology in facilities where the company already had lots of engineers and technicians, to speed the time to market.
Plants in Oregon, Arizona and New Mexico house some 75 percent of Intel’s chip manufacturing.
"Spending this money will lower our costs and give us more competitive products. It’s something that’s fundamental to our business model," he added.
The company also said the first processors to be built using the new technology are codenamed "Westmere" and will initially be used in desktop and mobile mainstream systems.
Every couple of years, chip companies make the multibillion-dollar switch to new equipment that enables chips with smaller and smaller circuitry, making each chip more powerful.
Image Courtesy UPI
—
On the Net: