Intel Corp. says it will expand its advanced chip manufacturing capacity, as the technology company's new chief executive revealed plans to spend up to $20 billion in two Arizona factories and open them to outside customers.
The announcement Tuesday by new chief executive Pat Gelsinger seeks to restore Intel's credibility after manufacturing mishaps sent its share price down last year.
The plan is part of Intel's new "IDM 2.0" strategy for design and manufacturing, which is divided into three parts.
The first is Intel's in-house manufacturing, which will continue to be an important aspect of Intel's chip design and production. Second, beginning in 2023, there will be a greater reliance on external foundries, such as Taiwan's Semiconductor Manufacturing Co. Ltd. and South Korea's Samsung Electronics Co. Ltd., for the production of "products at the core of Intel's computing offerings" for both consumer and enterprise chips.
Third, there is the newly unveiled Intel Foundry Services, which will see Intel open its doors to handle chip production for other commercial customers.
Intel Foundry Services is a "standalone foundry business unit" that will use Intel's manufacturing capabilities to produce x86, Arm and RISC-V core chips for external clients. Importantly for government work, Intel's foundries will be based in the U.S and Europe, an advantage that rivals such as TSMC do not have. IBM, Qualcomm, Microsoft, and Google are among its partners.
In an interview with Reuters, Gelsinger said that Intel has "fully resolved" its issues with its most recent manufacturing technology and that chips for 2023 are "all systems go." It is also planning a significant manufacturing expansion.
This includes a $20 billion spending on two new plants at an existing campus in Chandler, Arizona, which would create 3,000 permanent jobs. According to Gelsinger, Intel will then work on future sites in the U.S. and Europe.
Intel will use those factories to manufacture its own chips while still making them available to outside consumers in what is described in the chip industry as a "foundry" business model. Gelsinger said the latest factories will focus on cutting-edge computing chip manufacturing rather than older or niche technology that some suppliers, such as GlobalFoundries, specialize in.
Intel named Gelsinger its new chief executive officer in January, replacing Bob Swan after a rocky two-year run.
