WASHINGTON/SAN FRANCISCO, Jan 21 – Intel Corp said on Friday it would invest up to $100 billion to build potentially the world’s largest chip-making complex in Ohio as it seeks to boost capacity amid a shortage world of used semiconductors. in everything from smartphones to cars.
The move is part of Chief Executive Officer Pat Gelsinger’s strategy to restore Intel’s dominance in chipmaking and reduce the United States’ reliance on Asian manufacturing hubs, which tightly control the market.
An initial investment of $20 billion, the largest in Ohio history, in a 1,000-acre site in New Albany will create 3,000 jobs, Gelsinger said. That could grow to $100 billion with eight manufacturing plants in total and is the largest investment in Ohio history.
Dubbed the heart of silicon, it could become “the largest semiconductor manufacturing location on the planet,” he said.
While chipmakers are scrambling to ramp up production, Intel’s plans for new factories won’t alleviate current supply shortages, because such complexes take years to build.
Gelsinger reiterated on Friday that he expected the chip shortage to persist through 2023.
To dramatically increase chip production in the United States, the Biden administration is going to great lengths to convince Congress to approve $52 billion in grant funding.
Biden plans to promote the Intel investment on Friday at a White House event with Gelsinger and again defend action by Congress.
“This project is a crucial step in growing America’s domestic chip manufacturing capacity,” Deputy Secretary of Commerce Don Graves said in a separate statement.
Gelsinger said that without government funding “we are still going to start the Ohio site. It’s just not going to happen as fast and it’s not going to grow as fast.”
Intel ceded the No. 1 semiconductor supplier spot to Samsung Electronics Co Ltd (005930.KS) in 2021, falling to second place with growth of just 0.5%, the lowest rate among the top 25, they showed. Gartner data.
As part of its restructuring plan to become a major chipmaker for outside customers, Intel broke ground on two factories in Arizona in September. The $20 billion plants will bring the total number of Intel factories on its campus in the Phoenix suburb of Chandler to six. read more
Gelsinger told Reuters he still expected to announce another major manufacturing site in Europe in the coming months.
Intel’s investment in Ohio is expected to attract partners and suppliers. Air Products (APD.N) Applied Materials (AMAT.O) LAM Research (LRCX.O) and Ultra Clean Technology have shown interest in establishing a presence in the region, Intel said.
Construction of the first two factories is expected to start in late 2022 and production in 2025.