Intel has received approval to build a $2.5 billion chip-manufacturing plant
in China amid booming Chinese demand for chips used in personal computers and
mobile phones, the government said Tuesday.The factory is planned in
Dalian, Northeast China's Liaoning Province, the National Development
and Reform Commission, the country's top economic planning agency, said on its
Intel, the world's largest semiconductor maker, has not revealed plans to
build a chip plant in Dalian. Intel officials in Beijing and the chipmaker's
headquarters in Santa Clara, California, declined to comment, saying the company
has not made a formal announcement.
Demand for chips in China has soared as the country has risen to become the
world's largest population of mobile phone users and as computer sales grow
The government wants Chinese companies to spend more on developing profitable
technology and is encouraging foreign companies to move high-tech facilities to
The Intel factory approved for Dalian would use 90-nanometer technology, the
NDRC announcement said.
One key way the chip industry measures manufacturing sophistication is the
size of the circuitry, and the process Intel plans to use in the China facility
means the chip parts will be shrunken down to 90 nanometers, or 90 billionths of
That suggests that Intel plans to use the facility to manufacture flash
memory chips and chipsets, which act as a PC's central nervous system by sending
data from the microprocessor to other parts of the computer.
Intel currently uses the 90-nanometer process at factories in California, New
Mexico, Ireland and Israel to make chipsets and flash memory chips based on the
It also makes flash chips based on the NAND
architecture on the 90-nanometer process through a joint venture with memory
chipmaker Micron Technology Inc. NAND flash is a type of memory used in digital
music players and digital cameras.
Intel and Advanced Micro Devices are spending heavily to upgrade their
factories in other parts of the world to handle microprocessors that need more
advanced technology than factories producing chipsets and flash memory. The
smaller circuitry allows companies to drive down production costs and boost
performance by squeezing more transistors onto the same slice of silicon.
Intel currently makes most of its advanced microprocessors on 65-nanometer
technology and said production is slated to begin in the second half of this
year on the next-generation 45-nanometer technology. The transistors on chips
built on the 45-nanometer process are so small that 30 million of them could fit
onto the head of a single pin.
Intel has 6,000 employees in China and factories in Shanghai and the western
city of Chengdu making memory chips, microprocessors and other products,
according to the company's website.
The Intel facility in Dalian would be one of China's biggest single
foreign-financed projects if the company invested the full $2.5 billion (euro1.9
billion) cited in the government announcement.
The biggest foreign investment in China to date is a $4.3 billion (euro3.27
billion) petrochemical plant being built by Royal Dutch/Shell Group and two
Chinese partners on the country's southeastern coast.