Intel is planning a $20 billion chip manufacturing facility in Ohio

Washington/San Francisco: Intel Corp will announce on Friday it will invest $20 billion in a huge new manufacturing facility near Columbus, Ohio, to design and manufacture advanced semiconductor chips, sources briefed on the matter told Reuters With.

The proposed investment includes 3,000 permanent jobs on the 1,000-acre site in New Albany, Ohio. Time Magazine, which first reported the news, said Intel will build at least two semiconductor fabs.

President Joe Biden on Friday commented on the US government’s efforts to “increase the supply of semiconductors, produce more in America, and rebuild our supply chains here at home,” the White House said earlier.

Intel CEO Pat Gelsinger is scheduled to appear at the White House with Biden on Friday, sources told Reuters. The White House did not respond to a request for comment.

The initial $20 billion is the first step in an eight-plant complex that could cost tens of billions of dollars.

Intel declined to comment on its plans, but said in a statement that Gelsinger would disclose details on Friday of “Intel’s latest plans for investing in manufacturing leadership” as it works to “meet rising demand for… to satisfy advanced semiconductors”.

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Chipmakers are scrambling to ramp up production after manufacturers around the world, from cars to consumer electronics, faced chip shortages. Intel is also trying to reclaim its position as the maker of the smallest and fastest chips from current market leader TSMC, based in Taiwan.

Gelsinger also said last fall that he plans to announce another US campus before the end of the year, which would eventually house eight chip fabs.

He told the Washington Post the complex could cost $100 billion over a decade and eventually employ 10,000 people.

Gelsinger is driving Intel’s expansion plans, particularly in Europe and the United States, to compete with global rivals and respond to a global microchip shortage.

Intel and Italy are intensifying talks over investments expected to be worth around 8 billion euros ($9 billion) to build an advanced semiconductor packaging factory, Reuters reported late last year.

The Biden administration is going to great lengths to convince Congress to approve $52 billion in funding to dramatically increase chip production in the United States. The Senate voted 68-32 in favor of chip funding as part of a broader competition bill in June, but it was stalled in the House of Representatives.

House Speaker Nancy Pelosi said Thursday she hopes to “go to the conference” soon.

Still, Intel’s plans for new factories won’t alleviate the current shortage of demand, as such complexes take years to build. Gelsinger previously said he expects the chip shortage to continue into 2023.

In September, Intel broke ground on two factories in Arizona as part of its turnaround plan to become a major maker of chips for external customers. The $20 billion investments will bring the total number of Intel factories on its campus in Chandler, a suburb of Phoenix, to six.

Intel told Time it considered 38 locations before selecting New Albany, Ohio, in December. Ohio has agreed to invest $1 billion in infrastructure improvements to support the factory, Time said.

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