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Intel delays decisions on building new factories until 2022

Intel has decided delay until 2022 decision-making on new plants chip manufacturing company that it intends to build in Europe and the United States. Of course, according to Tom’s Hardware, this delay will have very little impact on the industry immediately, since it cannot satisfy the immediate demand for products, and the lifting of plants would not affect a greater availability of products in the short term.

Intel will therefore not announce the new locations later this year, as planned. As confirmed its CEO, Pat Gelsinger, at a press conference where he did announce the erection of a new chip design and testing plant in Malaysia. In which according to Reuters it will invest 7,000 million dollars and which will already be in the production phase in 2024.

As set out in its IDM 2.0 strategy, presented in early 2021, and which seeks to scale its semiconductor manufacturing beyond its products and become a competitive chipmaker, Intel needs to build several chip manufacturing plants, from which a few would be in the United States and Europe. These plants, which would cost up to 200,000 million dollars, will now be announced “in early 2022”, although without a specific date. That is, they could be announced in January, but they could also be confirmed in April.

In 2021 Intel has started the expansion of two of its semiconductor facilities. They are the company’s 52nd and 62nd factories, and are on its Ocotilo campus, near the Arizon town of Chandler. These new plants will cost about $ 20 billion and will improve the production capacity of the facilities already on campus. But it is not the same to build additional plants to those already operating on an already operational campus than to start up plants in completely new locations.

The company has confirmed that it will have a complex the size of a small city in the United States, which will cost between 60,000 and 120,000 million dollars. It will have between six and eight plants, in which chips will be manufactured with Intel’s next-generation nodes, which will be packaged with proprietary technologies of the company, such as EMIB and Foveros.

The company’s plans for its plants in Europe seem quite similar. Of course, he wants to start up a new campus in continental Europe, to begin the construction of a new plant of 20,000 million dollars and then build other modules, which would raise investment to 100,000 million dollars over time: over a decade. You need to build your new facilities where you have access to communications and talent, which in practice means you need to be close to large cities.

In addition, Intel hopes to get grants and incentives from local and national governments for several years, and convincing the authorities of this is difficult. But it will apply here, because building large-scale chip-making facilities is important to Intel and its chip-making business. By increasing your facilities, you can scale your production capacity in a similar way as TSMC does, with speed and advance planning. The negotiation, and its complexity in terms of valuations, agreements and preparation, may be the factor that delays the decision on where Intel to build its new plants.

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