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The $20 Bln Factory Of Intel In Ohio Could Become Largest Chip Plant On The Planet

The $20 Bln Factory Of Intel In Ohio Could Become Largest Chip Plant On The Planet
Intel Corp has announced making an investment of up to $100 billion in developing a chip factory in Ohio which could turn out to be the largest semiconductor-making complex in the world. The target of the company is to improve capacity as a global semiconductor shortage impacts the production of a range of products - smartphones to autos.
The move is part of Intel CEO Pat Gelsinger's effort to reclaim the company's chip-making prowess and diminish America's reliance on Asian manufacturing hubs, which have a stranglehold on the market.
According to Gelsinger, a $20 billion investment on a 1,000-acre site in New Albany, the largest in Ohio's history, will produce 3,000 employment. He told Reuters that with eight total fabrication factories, the investment might reach $100 billion, making it the largest in Ohio history.
He predicted that the area which is popularly referred to as the silicon heartland could become "the largest semiconductor manufacturing location on the planet."
While chipmakers scramble to increase production, Intel's plans for additional plants will not solve the current global supply shortage because such complexes take years to construct and commission them for manufacturing.
On Friday, Gelsinger maintained that he expects chip shortages to last until 2023.
The Biden administration hopes to persuade Congress to authorize $52 billion in subsidized financing to greatly increase chip manufacture in the United States.
Speaker of the House of Representatives Nancy Pelosi announced on Friday that a bill on competitiveness would be introduced soon to help boost semiconductor investment and supply chains. This includes $52 billion in funding.
On Friday, during a White House event with Gelsinger, US President Joe Biden praised Intel's initiative and once again urged Congress to act.
"China is doing everything it can to take over the global market so they can try to out-compete the rest of us," Biden said.
The present global supply chain for semiconductors is "far too dependent on conditions and countries halfway around the world", said US Commerce Secretary Gina Raimondo at the same event at the White House.
In the absence of government funding, "we're still going to start the Ohio site. It's just not going to happen as fast and it's not going to grow as big as quickly", Gelsinger said.
According to Gartner, Intel lost its No. 1 semiconductor supplier position to Samsung Electronics Co Ltd in 2021, falling to the second spot with the growth of only 0.5 per cent, the slowest pace among the top 25 chip makers.
Intel laid the foundation of two factories in Arizona in September as part of its rebound strategy to become a major maker of chips for outside clients. The $20 billion plants will raise Intel's total number of plants on its campus in Chandler, Arizona, to six.
According to Reuters, Gelsinger still expects to announce another significant production facility in Europe in the coming months.
Intel is not the only company increasing its investment. Samsung Electronics and Taiwan Semiconductor Manufacturing Co, or TSMC, have both made significant investments in the United States. As a result, there are concerns about a future chip glut.
"We still have years in front of us before we're even having a semblance of supply-demand balance," said Gelsinger. "Ask yourself what portion of your life is not becoming more digital."
"Yes, the industry is growing, and maybe the metaverse solves world hunger for the semiconductor industry. But there is a big bubble coming," said Alan Priestley, an analyst at Gartner.

Christopher J. Mitchell

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