Intel shelves delayed Fab 42 facility

Intel shelves delayed Fab 42 facility

Intel's Fab 42, a $5 billion facility hailed by Barack Obama as Intel's 'most advanced plant,' is to go empty and unused for the foreseeable future.

Intel has shelved plans to open its Fab 42 facility in Chandler, Arizona to produce 14nm chips, instead looking to leave the plant vacant for future expansion while upgrading existing facilities to the new process node.

Construction began on Fab 42, designed to increase the company's already sizeable investment in the Chandler region and provide a home for its 14nm process node, in 2011 with the company announcing an investment in the facility of over $5 billion. Despite some high-profile accidents at its sister facility Fab 32, including a chemical leak which injured 43 workers last year, the construction of Fab 42 was widely hailed as a positive for the region - including a shout-out from President Barack Obama in his 2012 State of the Union Address.

Sadly for Chandler, the opening has been indefinitely delayed. Speaking to Reuters, Intel's Chuck Mulloy confirmed that the facility will be 'left vacant for now' with a view to perhaps utilising the plant for future process nodes. The announcement comes following a delay to the plant's opening, which was originally scheduled to have begun production by the end of 2013.

According to Mulloy, the facility is complete with heating, ventilation and air conditioning (HVAC) systems but has not yet been outfitted with fabrication equipment - 'the actual tools, the expensive stuff, are not in there,' he told Reuters. Mulloy has not, however, provided an explanation of the reasoning behind Intel leaving a $5 billion facility vacant and empty beyond claiming 'it boils down to better capital utilisation.'

With Fab 42 to remain closed for the foreseeable future, Intel will instead work on upgrading its existing 22nm facilities to support the new 14nm process node.


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Corky42 15th January 2014, 11:39 Quote
Maybe this is a sign that the fourth-quarter financial results due tomorrow aren't going to look good for Intel.
SchizoFrog 15th January 2014, 12:15 Quote
Title page sub comment '...left empty for no'
rollo 15th January 2014, 12:16 Quote
Dout not opening a new plant that you already dumped $5bil into will make alot of dif to those results.
Corky42 15th January 2014, 12:26 Quote
It would cost a lot more than $5bil to outfit it with fabrication equipment, and with Intel's other fab's working at around %80 capacity obviously the demand they predicted would happen when they commissioned fab 42 isn't there any more.
Gareth Halfacree 15th January 2014, 13:29 Quote
Originally Posted by SchizoFrog
Title page sub comment '...left empty for no'
Must have been truncated by the CMS without me noticing - changed to "...left empty." Ta!
iwod 16th January 2014, 02:53 Quote
So that is a clear signal where Atom ( Mobile & Tablets ) and Notebook / Desktop Chips aren't doing well. The Atom plan never worked out, which means those expected capacity they originally anticipated wont there. Hence the Fab isn't needed. Notebook and Desktop Sales are rapidly shrinking and will properly shrink even more when larger size Tablet are coming in.

Intel's Revenue and Profits are currently only helped by its unchallenged domination in Server market. Which is now becoming a high volume and high profits market.
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