October 19, 2010 / 3:20 PM / 7 years ago

Intel says investing billions in U.S. factories

3 Min Read

NEW YORK (Reuters) - Intel Corp said on Tuesday that it plans to spend between $6 billion and $8 billion on high-tech manufacturing facilities in Arizona and Oregon, projects it estimates would create up to 8,000 construction jobs.

Intel, the world's largest chipmaker, said plans call for it to build a new fabrication plant in Oregon and upgrade several existing factories. The projects, it said, would support 6,000 to 8,000 construction jobs along with another 800 to 1,000 permanent new high-tech jobs.

Intel said the new plant in Oregon -- which would be called D1X -- is scheduled for research and development start-up in 2013. In addition, upgrades would be undertaken at four existing factories in Oregon and Arizona.

Currently, about 75 percent of Intel's microprocessor manufacturing takes place in the United States, while the majority of its sales occur overseas.

"Intel makes approximately 10 billion transistors per second. Our factories produce the most advanced computer technology in the world and these investments will create capacity for innovation we haven't yet imagined," Brian Krzanich, manager of Intel's manufacturing and supply chain, said in a statement.

The construction is aimed at outfitting the plants to manufacture Intel's next-generation 22-nanometer microprocessors. The microprocessors are due to be in production late next year with products on sale in early 2012, and should create room to build smaller, better performing devices with longer battery life.

Intel, which employs more than 80,000 people, including 45,000 in the United States, earlier this month called on the U.S. government to provide tax credits or tax holidays for companies that build new factories here to promote jobs.

It complained that it can cost $1 billion less to build and operate a semiconductor factory in countries other than the United States. Some 90 percent of the difference, it said, was due to tax and incentive policies rather than labor costs.

"Clearly we'd like that passed but if you take a look at it we have a large manufacturing base in the U.S. It's a great asset both from a hardware standpoint, but also the employees that are highly skilled and we're going to utilize that," Krzanich told reporters.

Intel's shares gained about 14 cents, or 0.73 percent, to $19.32 in Nasdaq trading.

Reporting by Paul Thomasch, with additional reporting by NoelRandewich in San Francisco; Editing by Gerald E. McCormick and Maureen Bavdek

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