Intel has delayed the timeline for its US$28 billion chip plants in Ohio from 2025 to 2030 due to market factors, reflecting a cautious approach amidst a substantial net loss of US$18.8 billion in 2024. Additionally, the company is scaling back its expansion plans in Malaysia and delaying projects in Europe as it faces increased competition.
Intel, a prominent American chip manufacturer, has announced a delay for the completion of its US$28 billion semiconductor plants in Ohio. Initially set to commence production in 2025, the timeline has now been extended to 2030. This decision underscores a conservative strategy in line with market demands. Naga Chandrasekaran, the general manager of Intel Foundry Manufacturing, communicated this in a message highlighting the necessity to synchronize production with business needs and market requirements.
The company experienced a substantial net loss of US$18.8 billion in 2024, reflecting ongoing challenges as it navigates the competitive landscape dominated by Asian manufacturers like TSMC and Samsung. The rise of Nvidia as a leader in AI chip production has further complicated Intel’s position in the semiconductor sector. Following increased scrutiny over the company’s direction, CEO Pat Gelsinger was dismissed in December after the board expressed a loss of confidence in his strategies.
In addition to the delays in Ohio, Intel has also postponed plans for two major factories in Germany and Poland due to lower-than-expected demand. Furthermore, the company has scaled back its expansion efforts in Malaysia, indicating a cautious approach in its overall growth strategy. Although the Biden administration allocated US$7.9 billion to Intel to enhance domestic semiconductor production, challenges persist as the company re-evaluates its projects internationally.
In summary, Intel’s decision to postpone the start of production at its new Ohio facilities reflects a calculated approach in response to market conditions amidst significant financial losses. The company is grappling with fierce competition from global rivals and has adjusted its expansion plans both domestically and abroad. The leadership change further emphasizes the need for a strategic reassessment to regain competitive viability in the semiconductor industry.
Original Source: www.malaymail.com
