Intel, Appears Ready to Build a Chip Plant in China

Intel is going to build a factory in China to manufacture chipsets used in cell phones, MP3 players and PCs based on 90-nanometer technology, but no microprocessors will be made. Intel’s state of the art technology is 45/65-nanometer, which are principally used in high-speed microprocessors. The 90-nanometer technology will obsolete in American market soon.

Intel has considered the plan for a long time because of cheap labor cost in China and the growing need of chips in the Asian market. Intel’s largest customer, Dell, does its manufacture in Asia. However, Bush administration tightened the high tech exports to China in recent years to protect intellectual property and maintain technology leadership. So it is unclear that even Intel’s low-tech plant can be realized.