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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowIntel plans to invest $20 billion in a new computer chip facility in Ohio amid a global shortage of microprocessors used in everything from phones and cars to video games.
After years of heavy reliance on Asia for the production of computer chips, vulnerability to shortages of the crucial components was exposed in the U.S. and Europe as they began to emerge economically from the pandemic.
The U.S. share of the worldwide chip manufacturing market has declined from 37% in 1990 to 12% today, according to the Semiconductor Industry Association, and shortages have become a potential risk.
Two chip factories on the 1,000-acre site in Licking County, just east of Columbus, are expected to create 3,000 company jobs and 7,000 construction jobs, and to support tens of thousands of additional jobs for suppliers and partners, the company and local and state officials announced Friday.
Construction is expected to begin this year, with production coming online at the end of 2025.
Shortages of chips have crimped the ability of U.S. automakers to produce vehicles and last year, General Motors was unseated by Toyota as the nation’s top-selling automaker for the first time.
The U.S. and Europe are pushing to aggressively to build chip making capacity and reduce reliance on producers that are now mostly based in Asia.
Several chipmakers last year signaled an interest in expanding their American operations if the U.S. government is able to make it easier to build chip plants.
Chipmakers are diversifying their manufacturing sites in response to the shortages. Samsung said in November it plans to build a $17 billion factory outside of Austin, Texas.
Micron Technology, based in Boise, Idaho, said it will invest $150 billion globally over the next decade in developing its line of memory chips, with a potential U.S. manufacturing expansion if tax credits can help make up for the higher costs of American manufacturing.
However, demand for computer chips continues to grow.
Lawmakers have been urging House and Senate leaders to fully fund a law meant to address the semiconductor chip shortage. They want Congress to fully fund the $52 billion CHIPS for America Act, allowing for stateside investment in semiconductor factories. Not only has the chip shortage disrupted the U.S. economy, it is creating a vulnerability in the country’s defense system since eight of every 10 chips are produced in Asia, lawmakers say.
Separate federal legislation also under consideration would create a new tax credit for investment in semiconductor manufacturing facilities.
U.S. Commerce Secretary Gina Raimondo applauded the announcement.
“Intel’s work is essential to our efforts to rebuild America’s chip building capacity and create the kinds of good-paying jobs that support a vibrant American economy,” she said.
The Intel project is the largest single private-sector investment in Ohio’s history, on par with an agreement in 1977 that brought Honda to central Ohio, where it now employs more than 14,000 people. The Intel jobs are expected to pay an average of $135,000 a year plus benefits, with the project slated to add $2.8 billion to the state’s annual gross product, Ohio Gov. Mike DeWine said in a statement.
“Intel’s new facilities will be transformative for our state, creating thousands of good-paying jobs in Ohio manufacturing strategically vital semiconductors,” DeWine said.
Intel, based in Santa Clara, California, announced plans last year to spend $20 billion for two new factories in Arizona. It’s also pitching for European subsidies to build a big plant somewhere within the European Union and last month said it will invest $7.1 billion to expand its decades-old manufacturing operation in Malaysia, home to roughly 10% of the company’s global workforce. Along with the U.S. and Malaysia, Intel also has existing plants in Ireland, Israel, Vietnam and China.
Intel is the No. 2 semiconductor manufacturer globally, with $73.1 billion in revenue last year, behind South Korean world leader Samsung Electronics with $76 billon, according market analysis from Gartner Inc.
Central Ohio, long known for a largely white-collar workforce, has added high-tech jobs in recent years, with Amazon, Facebook, and Google all building data centers in the region.
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But wait…I thought Indiana was “a state that works.” Apparently Ohio works better. Maybe our neighbor to the east gets the prize because it is politically more moderate than Indiana (Trump won Ohio by just 8% of the popular vote while he won Indiana by a whopping 16%).
I was wondering what would be the dumbest thing I read on the internet today. Thanks for knocking it out early.
Whattt?? hahaha.
I’m no fan at all of Pence, whose administration coined that lame-o motto. But, given that Ohio used to be the supreme swing state and is now merely somewhat soft red instead of ruby red, this is a really weird flex on your part.
The intellectual narcissism of the nu-Left knows no boundaries. They’ll continue thinking they’re better than everyone else, even when they’re asphyxiating on garbage, needles, and excrement–the biggest evidence of how much they really “care about others”.
Where does the massive hemorrhaging of businesses from California over to Texas and Florida play into your equation? You do realize that Illinois suffered a net loss in population in the 2010s?
Obviously Ohio had a better package to offer than Indiana. This is the 2nd big loss for Indiana with not getting the battery plant going to Michigan.
As much as I love to bag on the Indiana legislature, and as much as they frequently deserve it, I’d like to see how much Ohio offered in incentives.
Repeating the mistakes made in by Wisconsin (which offered Foxconn $3 billion for a plant that was never going to happen, and then promptly didn’t happen) would be foolish by Indiana.
That said, it’s also quite possible we were never in the running for all the reasons mentioned.
To be fair, our economy/pro business legislature had far more important issues to tackle:
Banning transgender athletes.
Lowering barriers to gun access.
Attacking efforts to build viable mass transit.
Supporting small/local government unless of course you live in Indianapolis.
Continuing the now 2 decade long assault on public education.
These list goes on and on.
I guess you could always take California as the “city on the hill” example of progress by 2020 metrics. The Golden State largely has policies that are 180 degrees from Indiana, and it’s working wonders for them in attracting new businesses. Never mind the supply chain issues currently plaguing most of the US (and Canada) have to do with their amazing ability to manage their massive ports–or keeping the freight cars away from marauding gangs…I mean, “misunderstood poor people who are desperate to feed their families” (thanks Gavin)
I’m not smart enough to understand progress by your definitions, Pat. I guess my 1980s-era public schooling wasn’t good enough, but I’m sure if you explain it to me using small words, the fog will lift from my meager brain and I’ll share your view of an earthly Xanadu. Utopic visions have always worked out so, so well in the past.
We lose, again. It’s almost like we can’t attract intellectual talent when a political party whose agenda is to trample on critical thinking has a 2/3rds majority in the legislature.
Indeed, Critical Race Theory isn’t just trampling on critical thinking, it’s taking its flattened cadaver and hoisting it up on a tree by noose, then setting it on fire.
1619 Theory = Neo-Confederate Lost Cause
Why do jealous, humiliated people (regardless of race) so persistently feel the need to reinvent history rather than getting their own acts together?
So, a highly technical microelectronics manufacturer would rather locate 20 miles from Ohio State than 20 miles from Purdue.
Whose engineering grads will be filling those really good jobs?
I think an appropriate response by Indiana would be to get the CHIPS act passed then push TSMC (Taiwan Semiconductor Manufacturing Company) to build here.
They’ve got higher end tech than Intel, matter of fact, Intel uses TSMC to make their highest end computer processors… as does Apple for all those iPhones.
Logic? BMW has higher end cars than Honda, Subaru, and Toyota but that doesn’t make their factories any less valuable to Indiana…
It’s too late to get Intel, get the market leader with technology that would last longer instead.
It’s be a great thing to get a car factory for (say) BMW cars with ICE engines. Getting a car factory for BMW making the new electric vehicles that they plan on making the core of their fleet would be a better thing.
I’m sure Indiana will get the consolation prize of making the cardboard boxes for high-tech items produced elsewhere.
Make ‘em? Naw. Distribute them? Of course!