The chip maker, which has seen market share gains of late against rival Intel, said it would build the new plant—or fab, in industry parlance—in Saratoga County, in upstate New York near Albany.
The plant is part of a multibillion-dollar plan by AMD to speed up the introduction of new technology.
The new 300-mm wafer plant, which will make chips based on a 32-nanomter process, will take about $3.2 billion in capital to build.
AMD, which said it aims to have enough manufacturing capacity to address a third of the x86 chip market by 2008, is also pledging to spend $2.5 billion to use to upgrade its Fab 30 plant by early 2008.
"Today marks a victory for the New York area … the state of American competitiveness and for AMD," AMD CEO Hector Ruiz said during a news conference to announce the plan for the new factory.
Ruiz indicated that AMD chose New Yorks Albany area over Dresden, Germany, where the chip makers current PC processor manufacturing is centered, as well as locations in Asia, due to New Yorks efforts to lure high-technology companies. The state and local governments there have established the Luther Forest Technology Campus, for example, which serves as a center for nanotechnology manufacturing and research.
AMD has said it looked to New York before deciding to build its Fab 36 in Dresden alongside Fab 30. Fab 30, AMDs first plant in Dresden, currently turns out the bulk of its PC chips using a 90-nanometer process and 200-mm wafers. Wafers are silicon discs that form the basis of chip manufacturing.
AMD has also been increasing production at Fab 36, which began shipping chips for revenue this quarter of 2006. Fab 36, which uses larger 300-mm wafers for increased output, got started with 90-nanometer manufacturing, but will move to a 65-nanometer process relatively quickly. The company has said it is on track to begin minting chips with its 65-nanometer process in volume during the fourth quarter of 2006.
AMD said it plans to convert Fab 30 to 300-mm wafers and rename it Fab 38, spending $2.5 billion. It plans finish the conversion in order to begin production in early 2008.
The chip maker has also said it plans to begin 45-nanometer production in mid-2008, and, less than two years later, in 2010, start its 32-nanometer manufacturing.
Ruiz offered few details on the companys plans or the economic package offered it by New York. Published reports put subsidies for the plant, which are subject to the passage of appropriations, at about $1.2 billion. Given that he indicated that the New York AMD plant will turn out 32-nanometer chips, AMD will need to complete building the plant in 2009.
The fab is expected to bring 4,000 to 5,000 jobs to the area, including 1,200 inside the fab itself.