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Intel will increase chip manufacturing with $ 20 billion in power plants

Intel will increase chip manufacturing with $ 20 billion in power plants

Intel has said it will spend $ 20 billion to build two new semiconductor plants in Arizona, the focus of an ambitious strategy such as outsourcing and launching a new computer chip service for other companies.

Pat Gelsinger shows the many-year-old strategies of the newly appointed CEO Intelit is committed to building most of its chips, ending the debate that should stop manufacturing after falling behind Asian competitors such as TSMC and Samsung.

At the same time, the team is marketing Intel Foundry Services to produce chips for other companies, a big change for the company that has come from being a designer and manufacturer in Santa Clara, California.

Intel shares rose more than 7 percent in overtime trading, and suggested investor support for a broad-based strategy that promised to boost chip production in the West, taking a new stance that would lead to partnerships and synergies.

The new strategy is the lack of a global chip that is wreaking havoc in the automotive industry. “The key challenge is to acquire manufacturing capacity,” Gelsinger said of the crisis. “It simply came to our notice then [a] a unique position to respond to this growing demand to reach that moment. “

Two new chip makers under construction in Arizona had a decisive move when investor activist Daniel Loeb’s Third Point hedge fund took a $ 1 billion stake in the technology team and suggested the company. consider throwing manufacturing operations.

New manufacturing is expected to begin production in 2024. Construction will begin this year, creating 3,000 jobs. Once built, Intel will create at least 3,000 “high-tech, high-paying permanent jobs” and about 15,000 long-term local jobs, Intel said.

The company called the plan IDM 2.0, an abbreviation for the “integrated device manufacturing” approach that the company designs and manufactures, while most of the industry is fragmented.

But Intel said it would be more open to calling it “cooperation,” or finding ways to cooperate with traditional opponents – and traditionally hiring rivals like Taiwan’s TSMC and South Korea’s Samsung. Gelsinger said Intel “underestimates the strategic use of external foundries.”

Its new foundry service, led by Randhir Thakur, will build chips in the US and Europe – an important development given the concentration of chips currently being built.

Gelsinger cited figures that gave the Asian foundry industry an 80 percent market share. It expects to have a $ 100 billion market by 2025. The US has a 15 per cent share and Europe a 5 per cent share.

Intel said it plans to become a “major supplier of foundry capacity” in the U.S. and Europe, with additional plans to be announced “within a year”.

Gelsinger mentioned that he wanted to go to Qualcomm, the chip designer: “Hey, let’s find ways to take advantage of ways that weren’t our technologies before, and can we become partners in your foundry?”

He added: “We will also continue to have customers like Apple,” he announced a major change in June Far from trusting Intel He has to design his own chips for Mac products, which are then manufactured by TSMC.

Intel also said its delayed and next-generation 7-nanometer manufacturing process, called Meteor Lake, is “progressing well” and will reach a milestone in the next quarter. “We’ve steered the ship and it’s going at a good 7 nm route,” Gelsinger said.

Daniel Newman, an analyst at Futurum Research, said Intel “is adamant about not repeating the mistakes of recent years with delays and production issues, so timeline commitments from the company should be very specific, as any time line bias will not be good.

Chipmaker’s plans were unveiled at a pre-recorded webinar, with a live question and answer session, including support from Microsoft and IBM CEOs.

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