Intel Prepares For $100 Billion Spending Spree Across Four US States 18
After securing billions in federal grants and loans, Reuters reports that the company is "planning a $100-billion spending spree across four U.S. states" to build and expand its chip manufacturing factories. From the report: The centerpiece of Intel's five-year spending plan is turning empty fields near Columbus, Ohio, into what CEO Pat Gelsinger described to reporters on Tuesday as "the largest AI chip manufacturing site in the world," starting as soon as 2027. Intel's plan will also involve revamping sites in New Mexico and Oregon and expanding operations in Arizona, where longtime rival Taiwan Semiconductor Manufacturing Co is also building a massive factory that it hopes will receive funding from President Joe Biden's push to bring advanced semiconductor manufacturing back to the United States. [...]
Gelsinger said about 30% of the $100-billion plan will be spent on construction costs such as labor, piping and concrete. The remaining will go towards buying chipmaking tools from firms such as ASML, Tokyo Electron, Applied Materials and KLA, among others. Those tools will help bring the Ohio site online by 2027 or 2028, though Gelsinger warned the timeline could slip if the chip market takes a dive. Beyond grants and loans, Intel plans to make most of the purchases from its existing cash flows.
"It will still take three to five years for Intel to become a serious player in the foundry market" for cutting-edge chips, said Kinngai Chan, an analyst at Summit Insights. However, he warned more investment would be needed before Intel could overtake TSMC, adding that the Taiwanese firm could remain the leader for "some time to come." Gelsinger has previously said a second round of U.S. funding for chip factories would likely be needed to re-establish the U.S. as a leader in semiconductor manufacturing, which he reiterated on Tuesday. "It took us three-plus decades to lose this industry. It's not going to come back in three to five years of CHIPS Act" funding, said Gelsinger, who referred to the low-interest-rate funding as "smart capital."
Gelsinger said about 30% of the $100-billion plan will be spent on construction costs such as labor, piping and concrete. The remaining will go towards buying chipmaking tools from firms such as ASML, Tokyo Electron, Applied Materials and KLA, among others. Those tools will help bring the Ohio site online by 2027 or 2028, though Gelsinger warned the timeline could slip if the chip market takes a dive. Beyond grants and loans, Intel plans to make most of the purchases from its existing cash flows.
"It will still take three to five years for Intel to become a serious player in the foundry market" for cutting-edge chips, said Kinngai Chan, an analyst at Summit Insights. However, he warned more investment would be needed before Intel could overtake TSMC, adding that the Taiwanese firm could remain the leader for "some time to come." Gelsinger has previously said a second round of U.S. funding for chip factories would likely be needed to re-establish the U.S. as a leader in semiconductor manufacturing, which he reiterated on Tuesday. "It took us three-plus decades to lose this industry. It's not going to come back in three to five years of CHIPS Act" funding, said Gelsinger, who referred to the low-interest-rate funding as "smart capital."
3 to 5 years (Score:2)
"It will still take three to five years for Intel to become a serious player in the foundry market"
Anyone else remember when Intel was already a serious player in the foundry market, before caking their pants for like 7 years?
Re:3 to 5 years (Score:4, Insightful)
> before caking their pants for like 7 years
Before the MBAs took over maybe.
Re: (Score:2)
Intel has never been a successful player in the foundry market. They've made some prior attempts to enter the market, but they all failed. Their most recent attempt was in 2014 with "Intel Custom Foundry", but the only major customer they secured was Altera... who Intel purchased in 2015. They gave up on that attempt by 2018.
Last Time I Heard A Chip Maker... (Score:2)
The last time I heard a chip maker planning to spend big bucks locally they proved to be all smoke and no fire ... they did not spend a penny of the money they claimed they would spend in my locality as promised.
INTEL ... I will believe your plans when the plants you promise to build--upgrade are actually cranking out chips that people are buying.
Too many of these tech companies are All Show and No Go to a degree that they could darken the entire sky with hot air ballons filled with promises.
Re: (Score:3)
The last time I heard a chip maker planning to spend big bucks locally they proved to be all smoke and no fire ... they did not spend a penny of the money they claimed they would spend in my locality as promised.
INTEL ... I will believe your plans when the plants you promise to build--upgrade are actually cranking out chips that people are buying.
Too many of these tech companies are All Show and No Go to a degree that they could darken the entire sky with hot air ballons filled with promises.
Right now they're in the promotion phase of their government handout. They need to make a big show of all the things they'll do with the taxpayer money they've been handed. Give it a year or two, with no progress, and I doubt anyone involved in handing them the money is even asking questions, while the public is left asking what happened to the billions of dollars we threw at them to build foundries inside the country. I do not trust any large, for profit company to take government funds and use them as the
Re: (Score:2)
I’m sorry, we don’t need to be (Score:3)
This ain’t Louisiana, man, I ain’t buyin it. Chatgpt is impressive if I need to write an essay about otters or want to half-ass an email to HR. But the idea that the next-gen chatgpt will lead to the singularity. That’s based on 24 tech-bro conjectures stacked on top of each other.
We should be funding intel as insurance - we should be keeping jusssssttttt enough top-line chip-fab capacity on US soil so that we could get by if China firebombs Taiwan, Korea and Japan. Beyond that, it’s pissing BIG amounts of money away for very little in return.
Unfortunately, Intel is probably the only US company that we have to work with on this. And maybe a 100 giga$ price tag is legit. Top-line fabs aren’t cheap. But there’s no need to go toe-to-toe with TSMC.
Re: (Score:3)
Misses the point of sloshing public money to private entities for... reasons.
It's all rugged capitalist until it's not, and should the public ask for equal consideration (I don't know... universal healthcare to maintain production and the like), it's creeping socialism.
Re: (Score:2)
But national security concerns are legit sometimes. If you’re one of those people who think any level of taxation/government-spending above zero is socialism, then we're gonna just have to disagree. We do need to keep a few top-line fabs on US soil.
Re: (Score:3)
That’s why it should be kept to a minimum - the government covers what’s required for national security, and let the free market take care of the rest. But national security concerns are legit sometimes. If you’re one of those people who think any level of taxation/government-spending above zero is socialism, then we're gonna just have to disagree. We do need to keep a few top-line fabs on US soil.
Then have the government fund the fabs and rent them out to the manufacturers. These behemoth companies aren't going to throw money away if they don't have to, and unless they government money comes with some serious enforceable strings attached, it's just going to be yet again a big fat wad of taxpayer money going to executive bonuses. I believe the person you responded to is pissed that any discussion of that level of government spending being used to help the general population is backhanded with the soc
YAIS (Score:3)
Yet Another Intel Story.
Their PR group seems to be putting in lots of overtime right now.
Thieving Bastards (Score:2)
What really gets on my tits about this is the Semiconductor industry USED to have heavy fab representation in Europe and the US but as usual screwed everyone over to save a buck and move to Fabs in China
Suddenly they have been caught with the pants down but are happy to take untold billions of Taxpayer money to fund new fabs in the US.
Fabs they will at some point in the future close down again.
Is running the fabs labor costly? (Score:2)
Is it the know-how or the labor cost that the most of the fabs are outside of the US? I always thought it was the design that was costly and tech/science heavy, both chips and processes, not just running the fabs?
Re: Is running the fabs labor costly? (Score:1)
Itâ(TM)s the taxes. The US has one of the highest corporate tax rates in the world and one of the most progressive tax schemes as well. Reduce the corporate tax rate and they would all start repatriating.
Re: (Score:2)
I'm sure it's a whole combination of reasons, including know-how, work rules, environmental rules, regulatory rules, taxes, cost of labor, etc. Now, Biden has added a bunch of additional DEI rules, which will make it even less attractive once the free money stops.