To: StormRider who wrote (42977 ) 5/25/2000 7:14:00 PM From: Don Green Read Replies (1) | Respond to of 93625
Intel Fights Chip Shortage With New Capacity (05/25/00, 6:21 p.m. ET) By Jack Robertson and Faith Hung, Electronic Buyers' News Intel took two big steps to addressing a shortfall in chips on Wednesday, announcing plans to build a 300-mm wafer plant in New Mexico and increase production of flash memory ICs at plants in Oregon, New Mexico, and Colorado to more than 2 billion over the next two years. The new fab will be located at Intel's Rio Rancho, N.M., site and will have 135,000 sq. ft. of clean room space adjacent to Intel's Fab 11. It will operate as a 300-mm plant from the time it's launched in 2002, according to Michael Splinter, head of Intel's technology manufacturing group -- unlike a 300-mm wafer plant planned for Chandler, Ariz., which will be converted from a 200-mm operation. So far known simply as Fab 11 Expansion, the plant will make a range of Intel chips with 0.13-micron processing. As with all Intel 0.13-micron processing, the fab will use copper interconnects in the chips' metal layers to improve performance, Splinter said. Intel's expansion plans should help it fend off accusations that it has misread customer demand. But the flash-IC shortages affecting Intel (stock: INTC) have been felt by virtually every one of its competitors -- some of which also are increasing capacity. For instance, Advanced Micro Devices (stock: AMD) earlier this week said it will build a joint $1.3 billion fab in Japan with production partner Fujitsu. Additionally, Fujitsu's U.S. chip subsidiary, Fujitsu Microelectronics, will add another $550 million plant at a site in Gresham, Ore., to expand flash-memory production to 30,000 monthly wafer starts. Hyundai Microelectronics is considering two fabs that could be used for flash memory production, while STMicroelectronics said recently that it planned to spend $1.4 billion on flash production in Italy and France. Intel said Wednesday it will sell 2 billion flash chips between now and 2002, twice as many as the company has sold in the last 12 years combined. Intel credits the increase mainly to the rising demand for mobile phones. Looking forward to 2002, Intel predicts 60 percent of its flash chips will be used in cell phones, compared with 45 percent historically. Intel also has bought an additional 140 acres in Hillsboro, Ore., for expansion of its development fab complex there. Other expansions or new construction plans are also under way in Massachusetts and Colorado.