7 ms·

Intel to invest $7B in factory in Arizona, employ 3,000

78 points by deepanchor 10y ago

40acres 10y ago
Just to clarify: This factory is about halfway complete. Intel halted completing the Fab around 2 years ago. I wonder if any deals were made w.r.t tax breaks to entice Intel to finish the project. EDIT: Source: http://www.pcworld.com/article/2088040/intel-puts-on-hold-fab-42-in-arizona-will-use-for-future-technology.html http://www.pcworld.com/article/2088040/intel-puts-on-hold-fa...
- problems 10y ago
  The threat of protectionism from the current administration has motivated a few companies in the auto sector already. Might be somewhat tied to that.
  - deleted 10y ago
    [deleted]
  - serge2k 10y ago
    Which companies? I know a few carried through with plans they already had, and Carrier took a deal.
- deeth_starr 10y ago
  Yeah, they had problems with the 14nm process and are delaying the 7nm process. I think it's actually 10nm now. It seems like there is some concern that we will get to 7nm. This announcement is Trump PR. It's smart business. Get out of the way.
  - nickpsecurity 10y ago
    "This announcement is Trump PR. It's smart business." That's how Im seeing it. Get on his good side turning an offshore opportunity into a bunch of domestic jobs. It can be spun into being critical for national security, too, if marketing team wants to take a chance on that.
    - deeth_starr 10y ago
      I think you're right. For the moment companies are reiterating long standing plans for US mfg jobs. But making it sound like new projects. A small number might be new. This is PR. My guess is that this is not because they like Trump but because trade wars will hurt indiscriminately. So try to create enough cover for his base so he doesn't go "full retard".
      - logfromblammo 10y ago
        If this was their plan all along, then they should have announced a plan to build a new chip fab in Mexico first. You see, when I was younger, I would occasionally visit a research facility operated by an animal behavior professor at the nearby university. This particular facility kept a wolf pack and a bison herd. The main pack had a big livestock trough for its water. Whenever the research staff refilled it with fresh water, one of the alphas would jump into the trough and urinate in it--every time. This is the same concept as the Battle Chess duck. You have to give the puffed-up bigwigs a way to mark their territory. Otherwise, they do something worse to show dominance. That funny taste in the water is a whole lot better than having to show your belly with someone else's jaws around your neck. So you loudly announce moving factory jobs to Mexico, then cave to political pressure on schedule, and proceed with reactivating the mothballed factory.
        deeth_starr 10y ago
        Sorry, are you saying that all interactions have to go along the "Battle Chess duck" trope? I see many other options. One, Intel invests 7b in a 7nm factory, oh shit 7nm is delayed, Trump elected, announce same factory now option.
        logfromblammo 10y ago
        No. I'm saying that the current administration has constrained itself politically, and Intel could have exploited that. The move to another country is the sacrificial detail that both forces the negotiation and allows a "compromise" to go 100% in Intel's favor.
- bslogic325235 10y ago
  According to WalletHub, Arizona is the 13th most dependent state on Federal subsidies. 18 of the top 20 states most dependent on Federal dollars heavily lean Republican. You know, the party that is all about fiscal responsibility, anti-wealth redistribution, yadda yadda. When everyone else is propping your state up, why not keep cutting state taxes to get some good PR around "job creation". https://wallethub.com/edu/states-most-least-dependent-on-the-federal-government/2700/ https://wallethub.com/edu/states-most-least-dependent-on-the...
mikeyouse 10y ago
I can't wait until every single company starts a PR campaign every single time they retool a factory or slightly expand production. "$1 billion investment, create or save 1,000 jobs!" Whatever keeps you out of the Twitter crosshairs I guess.
- giarc 10y ago
  Trump has already tweeted about it. It's like a new form of advertising. Trick the president into thinking he convinced you to re-invest, reap the benefits of his tweet.
  - bkmartin 10y ago
    But isn't that dangerous if he gets too much credit and gets reelected?
    - serge2k 10y ago
      More immediate problem is your customers and/or employees revolt. Intel doesn't need to care, but Uber already saw this.
    - giarc 10y ago
      For sure, Intel and Ford (among others) shouldn't be pandering to him. However, I understand their position and reasoning, I'd likely do the same thing.
  - messick 10y ago
    The Intel CEO announced the factory from the Oval Office this morning. This went way beyond some tweets.
  - nodesocket 10y ago
    > Trick the president How do you know President Trump is not fully aware of what's happening and the PR game. It's a win-win for him, since it encourages more companies to invest in US infrastructure. I don't think you're giving enough credit.
pcunite 10y ago
You don't have to like someone personally to appreciate the good they'll do for you and your family.
- jordache 10y ago
  mean while the guy ignores the magnitudes more jobs in the solar industry to favor the antiquate coal jobs.
  - problems 10y ago
    Hopefully he'll get on board with it soon - if things keep going the way they have been, soon it economically won't be feasible not to.
  - holydude 10y ago
    Are you implying antiquate == bad? Because it is not. Coal on the other hand... but no seriously what makes you think that solar industry is more efficient,cheaper and green?
  - zardo 10y ago
    Solar employment is highly distributed throughout the country. That's not going to win any districts for your party.
    - jordache 10y ago
      true. but I laugh at those coal workers thinking trump will somehow change market dynamics to make coal economical again.
- seanp2k2 10y ago
  Don't these types of fabs lead to things like all the EPA superfund sites around Silicon Valley? I personally hope we don't do that anywhere in this country again. Visit Guangzhou sometime to see what a city / country looks like with lax environmental regulations and a bustling manufacturing industry. You can still see the skyline from most parts of the city most days when the "fog" isn't so bad. Sure you and everyone you care about will die of cancer, but at least it would be better than damn socialism, right? And with all that money (just look at how rich they all are), surely everyone can afford hospital-grade whole-home air filtration systems like the rich there have. Edit: s/fans/fabs
suyash 10y ago
Trump effect - awesome!
- cheald 10y ago
  The only "Trump effect" here is Intel furiously signalling their "American-friendliness" over something they were going to do anyway. They have a strong presence in the Phoenix metro area already. http://www.intel.com/content/www/us/en/corporate-responsibility/intel-in-arizona.html http://www.intel.com/content/www/us/en/corporate-responsibil...
  - adventured 10y ago
    Intel had frozen development of this fab for years. Their CEO just said that the reason they decided to finally go ahead with it now is due to expectations on things like changes in tax policy. For you to be right requires the premise that Intel's CEO is lying, while you have zero evidence to support that.
    - sharkmerry 10y ago
      >> Their CEO just said that the reason they decided to finally go ahead with it now is due to expectations on things like changes in tax policy. Got a source? I didnt see that in the article. I did see "There will be no incentives from the federal government for the Intel project, the White House said."
      - problems 10y ago
        I think they just mean specific incentives given to intel for the move. There's been lots of talk about change in tax policy - especially at the borders which might prompt something like this.
        sharkmerry 10y ago
        Understood, but I was replying to his comment about Intel's reasons. parent comment said CEO stated that was the reason, then accused someone else of having zero evidence. I asked for evidence of his claim. you are correct though. "There's been lots of talk about change in tax policy....which might prompt something like this." but you used "might", not definitively stating a reason without source.
marricks 10y ago
I wonder if Intel considering it's third round of layouts in 18 months got as much coverage a couple months ago? Probably indicative of how a lot of companies will operate. Lots of talk about new factories or what have you while really just continuing business as usual. Gets me pretty worried about actually seeing wage growth during the Trump administration as a vague focus on building new factories and "keeping jobs here" won't drive wages up unless it's coupled with protections on labor groups and actual job creation leading to competition for labor... http://www.oregonlive.com/silicon-forest/index.ssf/2016/11/intel_facing_more_layoffs_repo.html http://www.oregonlive.com/silicon-forest/index.ssf/2016/11/i...
yuhong 10y ago
I have been thinking that currently NAND fabs would be good, not to restore jobs but to restore the balance of trade. It is probably not a simple matter though.
stuckagain 10y ago
Intel has always fabbed its high-IP parts in the USA or strongly allied countries (Israel, Ireland). They will never put a fab in China because the Chinese will rip off all their IP. The fact that Intel has resumed construction of a half-completed facility in the same town where they make almost everything else is not really news.
- 40acres 10y ago
  Intel opened a $ 2.5B fab in China in 2010. There's also an R/D office there.
  - stuckagain 10y ago
    Intel makes generic NAND memory on a 65nm process in that fab. That isn't the kind of IP anybody needs to steal.
    - 40acres 10y ago
      Good point. The organization that runs fabs (TMG) is also notoriously tight lipped in regards to corporate security, I would image they assessed leak risk before opening the fab.
buildops 10y ago
I visited their fab in Israel. Amazing place and they are Israel's top high tech employee. This is highly technical, high R&D stuff. Only their fabs in the US and a few other places (Israel, Ireland) can do that. But, in Israel they get preferential tax treatment (because otherwise they will leave and go to Ireland or the US). So I wonder what would have happened had Trump not been president, or alternatively, what tax breaks he promised.
- mywittyname 10y ago
  > So I wonder what would have happened had Trump not been president, or alternatively, what tax breaks he promised. Someone else in this thread noted the fab was announced in 2011 but Intel decided not to move forward with it's completion until a later date. http://www.pcworld.com/article/2088040/intel-puts-on-hold-fab-42-in-arizona-will-use-for-future-technology.html http://www.pcworld.com/article/2088040/intel-puts-on-hold-fa... > It was announced by former Intel President and CEO Paul Otellini during a visit by U.S. President Barack Obama to an Intel facility in Hillsboro, Oregon, and was highlighted by Obama as an example of U.S. manufacturing potential. Intel doesn't seem to care who is President.
- davidf18 10y ago
  Intel contributed $600 million (perhaps in tax breaks?) for the latest fab upgrade to 10 nm. It also has two design centers and altogether employs about 10,000 Iraelis. Intel first started in Israel around 1974-ish with a small design center. Dov Frohman, who invented the flash memory for Intel, convinced Intel to start the design center in Israel when there was an engineering shortage in the US. See Dov Frohman: Leadership the Hard Way https://www.amazon.com/Leadership-Hard-Way-Taught-Anyway/dp/0787994375 https://www.amazon.com/Leadership-Hard-Way-Taught-Anyway/dp/...
- secfirstmd 10y ago
  Judging by the current Israeli governments recent laws (passing a law to legalise the grabbing of private Palestinian land that even the Supreme Court said was a bad idea), it's likely there is going to be a lot of political problems in the next few years for companies making big investments in Israel. The boycott movement is really heating up. Israeli tech talent and industry is excellent but so far it has managed to avoid political effects, that probably isn't going to last forever.

78 points by deepanchor 10y ago

Just to clarify: This factory is about halfway complete. Intel halted completing the Fab around 2 years ago. I wonder if any deals were made w.r.t tax breaks to entice Intel to finish the project. EDIT: Source: http://www.pcworld.com/article/2088040/intel-puts-on-hold-fab-42-in-arizona-will-use-for-future-technology.html http://www.pcworld.com/article/2088040/intel-puts-on-hold-fa...

problems 10y ago
The threat of protectionism from the current administration has motivated a few companies in the auto sector already. Might be somewhat tied to that.
- deleted 10y ago
  [deleted]
- serge2k 10y ago
  Which companies? I know a few carried through with plans they already had, and Carrier took a deal.
deeth_starr 10y ago
Yeah, they had problems with the 14nm process and are delaying the 7nm process. I think it's actually 10nm now. It seems like there is some concern that we will get to 7nm. This announcement is Trump PR. It's smart business. Get out of the way.
- nickpsecurity 10y ago
  "This announcement is Trump PR. It's smart business." That's how Im seeing it. Get on his good side turning an offshore opportunity into a bunch of domestic jobs. It can be spun into being critical for national security, too, if marketing team wants to take a chance on that.
  - deeth_starr 10y ago
    I think you're right. For the moment companies are reiterating long standing plans for US mfg jobs. But making it sound like new projects. A small number might be new. This is PR. My guess is that this is not because they like Trump but because trade wars will hurt indiscriminately. So try to create enough cover for his base so he doesn't go "full retard".
    - logfromblammo 10y ago
      If this was their plan all along, then they should have announced a plan to build a new chip fab in Mexico first. You see, when I was younger, I would occasionally visit a research facility operated by an animal behavior professor at the nearby university. This particular facility kept a wolf pack and a bison herd. The main pack had a big livestock trough for its water. Whenever the research staff refilled it with fresh water, one of the alphas would jump into the trough and urinate in it--every time. This is the same concept as the Battle Chess duck. You have to give the puffed-up bigwigs a way to mark their territory. Otherwise, they do something worse to show dominance. That funny taste in the water is a whole lot better than having to show your belly with someone else's jaws around your neck. So you loudly announce moving factory jobs to Mexico, then cave to political pressure on schedule, and proceed with reactivating the mothballed factory.
      - deeth_starr 10y ago
        Sorry, are you saying that all interactions have to go along the "Battle Chess duck" trope? I see many other options. One, Intel invests 7b in a 7nm factory, oh shit 7nm is delayed, Trump elected, announce same factory now option.
        logfromblammo 10y ago
        No. I'm saying that the current administration has constrained itself politically, and Intel could have exploited that. The move to another country is the sacrificial detail that both forces the negotiation and allows a "compromise" to go 100% in Intel's favor.
bslogic325235 10y ago
According to WalletHub, Arizona is the 13th most dependent state on Federal subsidies. 18 of the top 20 states most dependent on Federal dollars heavily lean Republican. You know, the party that is all about fiscal responsibility, anti-wealth redistribution, yadda yadda. When everyone else is propping your state up, why not keep cutting state taxes to get some good PR around "job creation". https://wallethub.com/edu/states-most-least-dependent-on-the-federal-government/2700/ https://wallethub.com/edu/states-most-least-dependent-on-the...

mikeyouse 10y ago

I can't wait until every single company starts a PR campaign every single time they retool a factory or slightly expand production. "$1 billion investment, create or save 1,000 jobs!" Whatever keeps you out of the Twitter crosshairs I guess.

giarc 10y ago
Trump has already tweeted about it. It's like a new form of advertising. Trick the president into thinking he convinced you to re-invest, reap the benefits of his tweet.
- bkmartin 10y ago
  But isn't that dangerous if he gets too much credit and gets reelected?
  - serge2k 10y ago
    More immediate problem is your customers and/or employees revolt. Intel doesn't need to care, but Uber already saw this.
  - giarc 10y ago
    For sure, Intel and Ford (among others) shouldn't be pandering to him. However, I understand their position and reasoning, I'd likely do the same thing.
- messick 10y ago
  The Intel CEO announced the factory from the Oval Office this morning. This went way beyond some tweets.
- nodesocket 10y ago
  > Trick the president How do you know President Trump is not fully aware of what's happening and the PR game. It's a win-win for him, since it encourages more companies to invest in US infrastructure. I don't think you're giving enough credit.

pcunite 10y ago

You don't have to like someone personally to appreciate the good they'll do for you and your family.

jordache 10y ago
mean while the guy ignores the magnitudes more jobs in the solar industry to favor the antiquate coal jobs.
- problems 10y ago
  Hopefully he'll get on board with it soon - if things keep going the way they have been, soon it economically won't be feasible not to.
- holydude 10y ago
  Are you implying antiquate == bad? Because it is not. Coal on the other hand... but no seriously what makes you think that solar industry is more efficient,cheaper and green?
- zardo 10y ago
  Solar employment is highly distributed throughout the country. That's not going to win any districts for your party.
  - jordache 10y ago
    true. but I laugh at those coal workers thinking trump will somehow change market dynamics to make coal economical again.
seanp2k2 10y ago
Don't these types of fabs lead to things like all the EPA superfund sites around Silicon Valley? I personally hope we don't do that anywhere in this country again. Visit Guangzhou sometime to see what a city / country looks like with lax environmental regulations and a bustling manufacturing industry. You can still see the skyline from most parts of the city most days when the "fog" isn't so bad. Sure you and everyone you care about will die of cancer, but at least it would be better than damn socialism, right? And with all that money (just look at how rich they all are), surely everyone can afford hospital-grade whole-home air filtration systems like the rich there have. Edit: s/fans/fabs

suyash 10y ago

Trump effect - awesome!

cheald 10y ago
The only "Trump effect" here is Intel furiously signalling their "American-friendliness" over something they were going to do anyway. They have a strong presence in the Phoenix metro area already. http://www.intel.com/content/www/us/en/corporate-responsibility/intel-in-arizona.html http://www.intel.com/content/www/us/en/corporate-responsibil...
- adventured 10y ago
  Intel had frozen development of this fab for years. Their CEO just said that the reason they decided to finally go ahead with it now is due to expectations on things like changes in tax policy. For you to be right requires the premise that Intel's CEO is lying, while you have zero evidence to support that.
  - sharkmerry 10y ago
    >> Their CEO just said that the reason they decided to finally go ahead with it now is due to expectations on things like changes in tax policy. Got a source? I didnt see that in the article. I did see "There will be no incentives from the federal government for the Intel project, the White House said."
    - problems 10y ago
      I think they just mean specific incentives given to intel for the move. There's been lots of talk about change in tax policy - especially at the borders which might prompt something like this.
      - sharkmerry 10y ago
        Understood, but I was replying to his comment about Intel's reasons. parent comment said CEO stated that was the reason, then accused someone else of having zero evidence. I asked for evidence of his claim. you are correct though. "There's been lots of talk about change in tax policy....which might prompt something like this." but you used "might", not definitively stating a reason without source.

marricks 10y ago

I wonder if Intel considering it's third round of layouts in 18 months got as much coverage a couple months ago? Probably indicative of how a lot of companies will operate. Lots of talk about new factories or what have you while really just continuing business as usual. Gets me pretty worried about actually seeing wage growth during the Trump administration as a vague focus on building new factories and "keeping jobs here" won't drive wages up unless it's coupled with protections on labor groups and actual job creation leading to competition for labor... http://www.oregonlive.com/silicon-forest/index.ssf/2016/11/intel_facing_more_layoffs_repo.html http://www.oregonlive.com/silicon-forest/index.ssf/2016/11/i...

yuhong 10y ago

I have been thinking that currently NAND fabs would be good, not to restore jobs but to restore the balance of trade. It is probably not a simple matter though.

stuckagain 10y ago

Intel has always fabbed its high-IP parts in the USA or strongly allied countries (Israel, Ireland). They will never put a fab in China because the Chinese will rip off all their IP. The fact that Intel has resumed construction of a half-completed facility in the same town where they make almost everything else is not really news.

40acres 10y ago
Intel opened a $ 2.5B fab in China in 2010. There's also an R/D office there.
- stuckagain 10y ago
  Intel makes generic NAND memory on a 65nm process in that fab. That isn't the kind of IP anybody needs to steal.
  - 40acres 10y ago
    Good point. The organization that runs fabs (TMG) is also notoriously tight lipped in regards to corporate security, I would image they assessed leak risk before opening the fab.

buildops 10y ago

I visited their fab in Israel. Amazing place and they are Israel's top high tech employee. This is highly technical, high R&D stuff. Only their fabs in the US and a few other places (Israel, Ireland) can do that. But, in Israel they get preferential tax treatment (because otherwise they will leave and go to Ireland or the US). So I wonder what would have happened had Trump not been president, or alternatively, what tax breaks he promised.

mywittyname 10y ago
> So I wonder what would have happened had Trump not been president, or alternatively, what tax breaks he promised. Someone else in this thread noted the fab was announced in 2011 but Intel decided not to move forward with it's completion until a later date. http://www.pcworld.com/article/2088040/intel-puts-on-hold-fab-42-in-arizona-will-use-for-future-technology.html http://www.pcworld.com/article/2088040/intel-puts-on-hold-fa... > It was announced by former Intel President and CEO Paul Otellini during a visit by U.S. President Barack Obama to an Intel facility in Hillsboro, Oregon, and was highlighted by Obama as an example of U.S. manufacturing potential. Intel doesn't seem to care who is President.
davidf18 10y ago
Intel contributed $600 million (perhaps in tax breaks?) for the latest fab upgrade to 10 nm. It also has two design centers and altogether employs about 10,000 Iraelis. Intel first started in Israel around 1974-ish with a small design center. Dov Frohman, who invented the flash memory for Intel, convinced Intel to start the design center in Israel when there was an engineering shortage in the US. See Dov Frohman: Leadership the Hard Way https://www.amazon.com/Leadership-Hard-Way-Taught-Anyway/dp/0787994375 https://www.amazon.com/Leadership-Hard-Way-Taught-Anyway/dp/...
secfirstmd 10y ago
Judging by the current Israeli governments recent laws (passing a law to legalise the grabbing of private Palestinian land that even the Supreme Court said was a bad idea), it's likely there is going to be a lot of political problems in the next few years for companies making big investments in Israel. The boycott movement is really heating up. Israeli tech talent and industry is excellent but so far it has managed to avoid political effects, that probably isn't going to last forever.