Hardware News

Intel to postpone chip factory in Ireland

Michael Kanellos, CNET News.com CNet

Published: 13 Dec 2000 13:16 GMT

Intel will postpone opening a fabrication facility for making PC processors for a year due to current market conditions and the advent of larger, more economical wafers.

The Santa Clara, California-based chip giant is expected to announce Wednesday that it will postpone opening Fab 24 in Leixlip, Ireland, from the second half of 2001 to the second half of 2002. The factory is being built to make microprocessors, such as the Pentium 4. The fab was one of a number of construction projects announced by Intel this year as part of an aggressive capital expansion. In the first half of the year, Intel found itself losing business opportunities because demand for both microprocessors and flash memory outstripped supply.

To squelch the problem, Intel began to acquire or invest in new plants in New Mexico, Massachusetts and Colorado, among others.

In the second half of the year, however, sales slowed, giving the company less incentive to open a new plant.

Delaying the plant will also let the company more aggressively gear up for 300mm wafer production in 2002. These wafers, which have diameters measuring 300mm rather than 200mm, are far more economical from a production point of view. A single 300mm wafer can produce roughly 225 percent more wafers, which leads to lower overall costs.

Intel's first facility for the larger wafers is being built in New Mexico and will be operational toward the middle of 2002.

The Leixlip facility, which will cost approximately $2bn and include 135,000 square feet of clean room space, is part of a larger Intel industrial park in Leixlip.

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