Intel Starts Work on $2.5 Billion China Chip Plant

From Staff Reports

Intel Corp. (INTC), the world's largest chipmaker, said Saturday that construction work already has started on its $2.5 billion chip manufacturing plant in China - its first actual manufacturing plant in Asia.

Named "Fab 68," the new Intel chip-manufacturing facility will be "an integral part of our global manufacturing network while bringing us closer to our customers and partners in China," Intel Chairman Craig Barrett said in a statement. The Dalian, China facility is expected to be in operation in 2010.

Intel, which has been in a heated battle for market share against rival Advanced Micro Devices Inc. (AMD), has invested roughly $4 billion in China, according to

Intel, based in Santa Clara, Calif., already has two assembly-and-test plants in Shanghai and Chengdu. It also has research-and-development centers in Beijing, Shanghai and other areas in China.

Barrett this past week said that the company is still interested in building a chip-manufacturing plant in India, though the government "has been a bit slow in coming out with a semiconductor policy and missed the window" on its manufacturing facility "for now."

Intel also said it's working to develop local talent through partnerships with Dalian University of Technology and its establishment of the Semiconductor Technology Institute with the municipal government. That "partnership model" is the strategy many U.S. companies have adopted as part of their pathway to success.

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