Intel aims to bring more production back to the U.S. and Europe, counterbalancing Asia’s manufacturing dominance.
- Intel Corp (NASDAQ: INTC) looks to add facilities in France and Italy and put a critical production site in Germany in its bid to go global, Bloomberg reports.
- France will be home to a research and design center, and Italy will be the location of a test and assembly factory.
- The central wafer fabrication plant, or fab, will likely be built in Germany.
- State-of-the-art chip production plants cost over $20 billion, and their most expensive component, machinery, is usually obsolete within five years.
- The German plant could have a price tag in that range. Meanwhile, the report added that the Italian test and assembly plant would cost around $10 billion.
- Intel and government officials are still negotiating on the site, with Sicily being one area under consideration.
- Intel may build the French R&D center in either Paris or Grenoble. Such facilities typically cost only a fraction of the amount needed to make a factory.
- Even with the potential government help, Intel is budgeting up to $28 billion for new plants and equipment in 2022, up from roughly $18 billion this year.
- The report added that Intel looks to build factories that make chips for other companies, directly rivaling Taiwan Semiconductor Manufacturing Co Ltd (NYSE: TSM) in the so-called foundry business.
- Price Action: INTC shares traded lower by 0.14% at $50.90 in the premarket session on the last check Thursday.
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