Intel is forced to suspend construction of a plant in Malaysia

Intel’s serious financial difficulties are no secret, and at this stage they are beginning to affect the implementation of plans for the construction of new enterprises. According to Malaysian media, the company has partially suspended the construction of a chip testing and packaging facility in Penang, which it announced back in 2021.

Image Source: Intel

At that time, Intel planned to spend about $7 billion over ten years to develop its production infrastructure in Malaysia. At the same time, the decision will not affect the activities of an existing enterprise for testing and packaging chips. Intel’s recently announced intentions to cut 15% of its entire workforce will also affect employees in Malaysia, about 2,000 of them could lose their jobs, as noted by The Star. Three weeks ago, Penang state authorities noted that Intel continues to expand production in Malaysia, but the situation is changing rapidly. The company will have to rethink the feasibility of investing in the construction of new enterprises in other geographical locations on the planet.

Construction of Intel’s new facility in Malaysia is technically continuing, but with a smaller workforce, the sources said. The installation of equipment in those premises of the new enterprise that have already been prepared for this phase has been suspended. The further fate of this enterprise will have to be decided by the end of September. Malaysia remains Intel’s largest manufacturing site outside the United States, although it only handles chip testing and packaging operations. There are similar enterprises in China, Vietnam and the Philippines. Intel’s Malaysian enterprises account for up to 20% of national electronics exports. The company began investing in the local economy back in 1972. It was Intel’s activity that contributed to the transformation of Malaysia into the largest regional hub for the supply of semiconductor components.