AMD, Intel Extend Manufacturing in Asia

Intel opens its first assembly and test plant in China and announces that it is planning to spend $230 million to build another plant in Malaysia; AMD is considering expanding its manufacturing operations into China.

Chip makers advanced Micro Devices Inc. and Intel Corp. are looking to make moves in Asia to keep up with their expanding businesses.

Intel last week opened its first assembly and test plant in China and announced that it is planning to spend $230 million to build another plant in Malaysia.

For its part, AMD, two months after licensing its x86 processor design to the Chinese government, last week said it is considering expanding its manufacturing operations into the region.

Speaking to reporters last week, AMD President and CEO Hector Ruiz said the Sunnyvale, Calif., company is going to grow its investments in Asia and may open a new fabrication plant in the region.

The moves come as both companies—as well as other technology vendors—turn their attention to the region as a source of skilled and less expensive labor as well as a rapidly growing market.

Intel Chairman Craig Barrett joined local officials in a ceremony marking the opening of the new $200 million test plant in Chengdu, in western Chinas Sichuan Province. A second test facility is slated to open in China next year, according to Intel.

"Chinas focus on science and technology education has advanced the nations competitiveness and attracted Intels investment in world-class microprocessor assembly and test facilities in Chengdu and Shanghai," Barrett said in a statement. "A skilled and talented local work force is a solid foundation on which to build businesses and develop new economic opportunities."

Intel also announced it is extending the Intel Volunteer Matching Grant Program to China. With the program, for every 20 hours an Intel employee volunteers in a school, Intel donates $75 to that school.

/zimages/5/28571.gifDual-core chips are barely out the door, but Intel and AMD are already working away to deliver quad-core processors. Click here to read more.

The new Malaysia plant will expand Intels presence in that country, which, with 8,500 employees on three campuses, is the companys largest operation outside the United States.

Also last week, Intel, of Santa Clara, Calif., announced it will invest $1 billion in India over the next five years, in part by developing a PC made specifically for the Indian market and by laying out money for new companies in the country.

For AMD, its expansion into Asia could include a new manufacturing plant in the region. The company currently runs a test and design facility in Singapore, as well as assembly plants in Malaysia and a testing plant in China.

Ruiz said AMD may need to start building another manufacturing plant next year as demand for its products—particularly dual-core processors—grows, and Asia is a possible landing place for the plant. AMD this year opened a new fab in Dresden, Germany.

Late last month, AMD announced a deal with SemIndia Inc. to bring processor and logic manufacturing technology to a $3 billion chip-making plant SemIndia plans to build in India. AMD also may eventually pick up a stake in the new plant, which is scheduled to open within the next three years.

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