Intel Triples Vietnam Investment to $1B

Intel  is upping the stakes in its chip building
plant in Vietnam to $1 billion, more than three times its original price tag.

The world’s largest chipmaker said it would increase the size of the
assembly and test facility it is building in Vietnam from 150,000 square
feet to 500,000 square feet. It had planned to spend $300 million on the
plant. But after an internal study, Intel said it concluded more money and
more space would be ideal.

Once the plant is running by 2009, it will rank as the largest single
factory within Intel’s assembly and test network, with as many as 4,000
workers employed there. Builders are slated to break ground in March of

The Vietnam facility is part of Intel’s worldwide expansion of production
capacity. By the end of this year, the company plans to invest nearly USD$6
billion worldwide for capital additions.

Rival AMD is likely to notice. The company got plenty of press over its
plans in 2003 to build a second $2.4
billion chip fabrication plant in Dresden, Germany.

Big chip-making deals have been in the news lately. As recently reported, a chip foundry partnership between IBM, Chartered Semiconductor and Samsung Electronics has the industry abuzz over
their “Common Platform” open source business model to enable synchronized
manufacturing across 300mm fabrication facilities at 90nm, 65nm and 45nm
process technologies.

This means that so-called “fabless” chipmakers can outsource to multiple
manufacturers with their designs.

Intel’s Vietnam facility, when completed, will be the seventh assembly
and test site in Intel’s global network, which includes Penang and Kulim,
Malaysia; Cavite, Philippines; Chengdu and Shanghai, China; and San Jose,
Costa Rica.

Brian Krzanich, vice president and general manager for Intel’s Assembly
and Test division, said the Vietnam facility will be the model for larger,
more efficient assembly and test facilities.

The deal comes as Vietnam is on the minds of the lawmakers. According to
Dow Jones, Congressional leaders hope to move next week on legislation
granting permanent normal trade relations to Vietnam.

President Bush is also planning a visit to Vietnam next week along with
other world leaders during the Asia-Pacific Economic Cooperation summit.

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