New Companies In Columbus Ohio - Intel chooses Ohio for 'largest silicon manufacturing site on the planet' / Intel to spend at least $20 billion on new manufacturing center near Columbus
Chipmaker Intel will spend at least $20 billion on a new chip manufacturing site in New Albany, near Columbus, Ohio, the company announced today. The 1,000-acre site will initially host two chip factories and is set to directly employ at least 3,000 people and "thousands" more at suppliers and partners. Construction is reportedly set to begin this year with the site operational in 2025.
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In an interview with Time, Intel CEO Pete Gelsinger said the company hopes the site will become "the largest silicon manufacturing facility on the planet," eventually expanding to 2,000 acres with eight fabs. After helping to establish Silicon Valley, Gelsinger said the new site could become the "Silicon Heartland." Intel plans to invest up to $100 billion at the site over the next decade, as well as about $100 million to foster new talent with Ohio universities, colleges and the U.S. National Science Foundation.
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Intel already has US factories in several states, including Oregon, New Mexico and Arizona. According to a New York Times report, Ohio represents the first manufacturing expansion in a new state in more than 40 years. Intel has aggressively increased investment in manufacturing capacity under its new CEO, who has already announced a $20 billion expansion of the company's existing Arizona complex.
Expanding in a state without an existing chip manufacturing presence creates challenges such as obtaining proper permits, raw materials and equipment, and manufacturing machinery.
Note, however, that New Albany is known for its cheap land, and any manufacturing project could benefit from engineering graduates from nearby Ohio State University.
Intel's search for a new manufacturing center saw the states scramble for the huge economic opportunity the new plant represented.
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Reports say at least one other state offered more subsidies, but Ohio had a better regulatory fit and Intel didn't want to displace existing residents. That's in stark contrast to Amazon's hyper-competitive bidding process that ultimately gave New York its second headquarters, which it avoided after a backlash from residents and local lawmakers.
The announcement comes as the world continues to battle a chronic shortage of computer chips affecting everyone from game console makers to automakers. It highlighted a decade-long decline in chip production from the US and Europe to Asian countries, particularly Taiwan where Taiwan Semiconductor Manufacturing Company (TSMC) is headquartered. To help reverse the shift, the US Senate last June approved a $52 billion subsidy package for the chip industry that would provide subsidies to companies building new US factories, but it has not yet passed the House.
Intel rivals TSMC and Samsung have announced their US-based manufacturing investments in Arizona and Texas, respectively. But for some officials, Intel has the advantage of being an American company, while TSMC's closeness to China worries Pentagon officials.
"Today's investment is leading Intel's efforts to restore leadership in US semiconductor manufacturing," Intel CEO Pat Gelsinger said in a statement. "Intel's actions will help create a more flexible supply chain and ensure reliable access to advanced semiconductors for years to come. Intel is bringing key skills and capabilities back to the United States to strengthen the global semiconductor industry. A As part of an effort to regain its position as a leading semiconductor maker amid a global chip shortage, Intel has committed $20 billion to build a product megasite in New Albany, outside Columbus, Ohio. , the company specifically confirmed.
Intel To Invest At Least $20 Billion In New Chip Factories In Ohio
The chip maker says it will build at least two semiconductor fabrication plants, or fabs, on the 1,000-acre site where Intel will research, develop and produce its latest computer chips, employing at least 3,000 people. . Construction will begin this year and the plant will be operational by 2025, the company said.
Intel's announcement is the largest private sector investment in Ohio history and marks the end of a decade of disappointment for manufacturing in Ohio and the Midwest. Large employers such as General Motors shed thousands of jobs as factory jobs moved to the American South and overseas. But as automation increases efficiency in factories, replacing assembly line jobs with technical manufacturing, Ohio is trying to make a comeback in manufacturing.
"We expect this to become the largest silicon manufacturing facility on the planet," said Intel CEO Pat Gelsinger. The company has options to eventually expand to 2,000 acres and eight fabs. "We helped establish Silicon Valley," he said. "Now we're going to do Silicon Heartland."
The announcement comes amid efforts to boost domestic production of semiconductors. According to the Semiconductor Industry Association (SIA), due in part to large incentives offered by other countries to jumpstart semiconductor production on their shores, the share of U.S.-made chips has fallen from 12 percent in 1990 to 37 percent in 1990. from percent. Rising demand and supply chain issues have led to semiconductor shortages in the past year, across U.S. industries such as auto manufacturing.
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Semiconductor production in the United States has slowed much more than elsewhere in the world, particularly in East Asia, where it costs 30 percent more to build and operate a fab over 10 years than in Taiwan, South Korea, and South Korea. . or Singapore, according to SIA.
To create a more reliable supply of chips, the federal government in the US passed the Chips for America Act last year, allowing federal investment in chip production, but not providing funding. The Senate approved $52 billion in funding in June, but the House did not pass the legislation.
Intel has joined other leading semiconductor companies, including rivals AMD, Inc., NVIDIA and GlobalFoundries, in lobbying President Biden to fund semiconductor research and manufacturing. Gelsinger has met with various leaders in Washington, including the bipartisan Problem Solving Caucus in Congress and the New Democratic Alliance, and has emphasized the need to bring more semiconductor manufacturing capacity to the United States. Said "I said, why am I saying this is so important to Congress and you're not?"
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Supply chain disruptions over the past two years are part of the reason there is an urgent need to build more chip manufacturing capacity in the US. did it in vain American plants last year and those that require chips have resorted to building some cars without explanation. This made it more difficult for American consumers to buy a car, caused used car prices to rise 24 percent in one year and slowed national economic growth.
Supply chain disruptions have prompted major companies to add capacity in the United States; Intel itself said last year that it would spend $20 billion to build two giant factories in Arizona, and in 2020, Taiwan Semiconductor Manufacturing Company (TSMC), the world leader in chip production, also said it would spend $12 billion to build a semiconductor. To build a conductor factory. . in Arizona. Samsung is investing $17 billion in a chip plant in Texas.
Of course, some of the urgency for more chip makers in the US is purely political. Locating a chip factory in the U.S. doesn't necessarily insure against more supply chain disruptions; Intel's chips will still be shipped to Asia for assembly, packaging and testing. Chips cross dozens of boundaries before reaching consumers in phones, computers and cars, said Dan Hutcheson, vice president of Tech Insights, which follows the semiconductor industry. Three-quarters of the world's semiconductor manufacturing capacity is within the Chinese air force's flight path, Hutchison said, which could be problematic in an era of heightened geopolitical tensions.
Intel could bring some packaging, assembly and testing back to the United States if the Affordable Care Act is funded, Gelsinger said, which would be beneficial for national security. The sand used to make semiconductors comes from the southern United States, so it's not inconceivable that some of the chip-making process, from start to finish, could be done domestically. "My goal is to have all the products on American soil," he said.
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In addition to the incentives offered, most chip production ended up in Asia because of low labor costs there, he said. But now, with increased automation in chip factories and possible government funding, Intel is able to recover some of that production and still be profitable.
Because of purchasing subsidies, semiconductor fabs are now being made in the U.S., said Bernstein Research senior analyst Stacey Rasgan. There is bipartisan support for subsidies for US manufacturing, particularly in the technology industry. Finding the factory in the political battlefield
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