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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Paul Engel who wrote (59217)	7/1/1998 9:43:00 PM
From: Paul Engel	Read Replies (7) \| Respond to of 186894

Intel Investors - This doesn't look good - Intel will temporarily close two wafer fabs in Oregon - for 9 days around the holiday. Here's the story. Paul {===========================} news.com Intel to shut plants temporarily By Michael Kanellos Staff Writer, CNET NEWS.COM July 1, 1998, 6:30 p.m. PT Intel will temporarily close two of its chip fabrication facilities for nine days beginning this weekend, even as it starts a "voluntary separation" program to trim back its workforce. The temporary plant closure--to affect 1,700 workers--and the job cutback program are essentially aimed at cutting costs in a slower-than-expected market, said Bill MacKenzie, a public information officer at Intel. Closing the fabrication facilities will help reduce chip supplies, while the employee separation program will work toward reducing the overall employee headcount. "Basically, we are responding to market conditions," he said. Earlier this year, Intel said it would lower headcount by 3,000, but these latest developments seem to indicate a growing aggressiveness in cutting bottom-line costs. Plant closures are relatively uncommon at Intel and have not previously been discussed publicly. Industrywide, however, several beleaguered memory chip manufacturers have enforced temporary shutdowns this year in an effort to reduce oversupply Similarly, the reduction of 3,000 employees was originally going to be accomplished mostly through attrition, not through organized layoffs. But Intel is now offering severance packages to rid itself of employees. The company currently has 65,000 employees. Some analysts have said that Intel will have to increase the amount of cutbacks still more if it's to get back on track. Intel is an investor in CNET: The Computer Network. Intel will temporarily shut plants 5 and 15 in the company's Aloha manufacturing facility in Oregon from July 4 through July 12, MacKenzie said. Approximately 1,700 manufacturing employees will be sent home without pay during this period. "Warm downs" such as this are not unknown, said MacKenzie, but not common either. He could not recall other temporary closures such as this in the past year in Oregon. Plants 5 and 15 are used for the production of chipsets, microprocessors, and other products, MacKenzie said, but are not cutting-edge facilities. Both produce silicon based around the older 0.35-micron process technology, although Plant 15 is being refitted to handle the 0.25-micron process technology. The voluntary separation program will begin next week. Under the program, Intel will offer manufacturing employees severance payments for leaving the company. MacKenzie said details are still being worked out. Sources close to the situation, however, have said that Intel is considering giving employees payments equal to up to four months of their regular salary with additional payments depending on years of service and job title. These terms would be similar to those offered to some 650 employees Intel will lay off from a Dupont, Washington, facility beginning in August. MacKenzie said that positions eliminated through the separation program are part of the effort to reduce headcount by 3,000, but added that the total number of positions affected could potentially exceed that number. Tech Talk...