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This year, 80% of the chips for new PCs will be produced in… Silicon Valley… Taiwan… China's Shenzhen Province… South Korea…?
Wrong on all counts.
More and more of today's chip makers, including Intel Corp. (Nasdaq: INTC), the company I want to tell you about today, are locating their manufacturing facilities a bit off the beaten path these days – in one of the world's fastest-growing economies – and a nation that some of you may find controversial.
But my job is to take you wherever the biggest innovations are being made so that we can find the biggest opportunities.
So today I'm going to show you exactly where so many of the world's top tech companies are headed.
Intel Inside… Vietnam
Many investors might be tempted to steer clear of Vietnam because of the way the U.S. conflict ended there and the political upheaval it caused back home.
As someone who's kept an eye on this controversial nation for more than 40 years, I believe that's a lot of noise. And you know what Rule No. 2 says about that – "separate the signal from the noise."
Vietnam is an economy that boasts impressive economic growth and that offers tech investors many hefty and growing opportunities.
Gross domestic product in 2014's third quarter grew 6.19% from a year earlier. And for the first nine months of last year, industrial output grew 6.7%, and exports rose 14.1% from a year earlier to $109.6 billion.
Many of those exports are the microchips that we so often invest in here at Strategic Tech Investor.
As I said above, 80% of this year's central processing units (CPU) for PCs will be made not just in Vietnam, but in a single location – Saigon Hi-Tech Park. The sprawling facility sits just off Hanoi Highway less than 10 miles from Ho Chi Minh City, the nation's capital.
The plant that will produce all these chips is owned by Intel Corp. (Nasdaq: INTC).
Intel is not only the world's leading PC chip maker, with its flagship Haswell CPU product; it's also long been a leader in Vietnamese tech production. Intel Vietnam's CPU line is the latest addition to a major testing and production plant that broke ground back in 2006.
The plant is rapidly ramping up production. In early 2014, Intel opened a new line for another of its signature products, the system-on-a-chip (SoC). That unit is making chips for smartphones and tablets and was on pace to make roughly 40 million SoCs last year.
Intel started up its Vietnam operations back in 2006 with an investment of $300 million. The company more than tripled that amount to $1 billion just one year later.
Locating in Vietnam was a good strategic move for Intel – one that is really starting to pay off.
About the Author
Michael A. Robinson is a 36-year Silicon Valley veteran and one of the top tech and biotech financial analysts working today. That's because, as a consultant, senior adviser, and board member for Silicon Valley venture capital firms, Michael enjoys privileged access to pioneering CEOs, scientists, and high-profile players. And he brings this entire world of Silicon Valley "insiders" right to you...
- He was one of five people involved in early meetings for the $160 billion "cloud" computing phenomenon.
- He was there as Lee Iacocca and Roger Smith, the CEOs of Chrysler and GM, led the robotics revolution that saved the U.S. automotive industry.
- As cyber-security was becoming a focus of national security, Michael was with Dave DeWalt, the CEO of McAfee, right before Intel acquired his company for $7.8 billion.
This all means the entire world is constantly seeking Michael's insight.
In addition to being a regular guest and panelist on CNBC and Fox Business, he is also a Pulitzer Prize-nominated writer and reporter. His first book Overdrawn: The Bailout of American Savings warned people about the coming financial collapse - years before the word "bailout" became a household word.
Silicon Valley defense publications vie for his analysis. He's worked for Defense Media Network and Signal Magazine, as well as The New York Times, American Enterprise, and The Wall Street Journal.
And even with decades of experience, Michael believes there has never been a moment in time quite like this.
Right now, medical breakthroughs that once took years to develop are moving at a record speed. And that means we are going to see highly lucrative biotech investment opportunities come in fast and furious.
To help you navigate the historic opportunity in biotech, Michael launched the Bio-Tech Profit Alliance.
His other publications include: Strategic Tech Investor, The Nova-X Report, Bio-Technology Profit Alliance and Nexus-9 Network.