Page last updated at 18:17 GMT, Tuesday, 10 February 2009

Intel announces $7bn plant plan

Intel
Intel hopes the investment will consolidate its market-leading position

Computer chipmaker Intel has announced plans to build new plants worth $7bn (4.78bn) weeks after announcing the closure of five plants.

The world's biggest chipmaker says the investment will fund 7,000 jobs in Oregon, Arizona and New Mexico.

Last month, Intel said it was cutting up to 6,000 jobs in response to slowing consumer demand for computers.

It also aims to increase production of faster chips. Two of the plants being closed make older-style chips.

"Spending this money will lower our costs and give us more competitive products. It's something that's fundamental to our business model," said Intel chief executive Paul Otellini.

"From our perspective this is a cheaper, better technology," he said.

Nanometer race

Intel has the advantage of the being the largest chipmaker and is using its bigger purse to expand while some of its rivals scale down.

California-based Intel is hoping to boost its fortunes by using the new plants to produce 32 nanometer chip technology, which will lead to its products performing faster and more efficiently.

A nanometer is one billionth of a meter and the majority of Intel's chips use 45 nanometer technology.

Intel's nearest competitor, Advanced Micro Devices (AMD) is already busy upgrading plants, though it is still lags some way behind Intel. AMD is phasing in 45 nanometer technology to replace 65 nanometers.

Intel said in January it would close five plants in California, Oregon, Malaysia and the Philippines with the loss of between 5,000 and 6,000 jobs.

It said the two US factories were based on older microchip technology.

Intel's plans come as joblessness in the US soars. In January the US unemployment rate reached 7.6%, the highest level since 1992.



Print Sponsor


SEE ALSO
Intel shedding up to 6,000 jobs
22 Jan 09 |  Business
Big loss at Taiwanese chipmaker
10 Feb 09 |  Business
Intel in second revenue warning
08 Jan 09 |  Business

RELATED INTERNET LINKS
The BBC is not responsible for the content of external internet sites


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

BBC navigation

BBC © 2013 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific