Intel's US$20b Ohio factory could become world's largest chip plant

Intel Corp said on Friday that it would invest up to US$100 billion in Ohio to build the world's largest chip-making complex, to boost capacity as a global shortage of semiconductors affects everything from smartphones to cars.

The move is part of Intel CEO Pat Gelsinger's strategy to restore the company's chip-making dominance and diminish America's reliance on Asian manufacturing hubs that have a tight hold on the market.

An initial US$20 billion investment - the largest in Ohio's history - on a 1,000-acre site in New Albany will create 3,000 jobs, Gelsinger said. That could grow to US$100 billion with eight total fabrication plants and would be the largest investment on record in Ohio, he told.

Dubbed the silicon heartland, it could become "the largest semiconductor manufacturing location on the planet," he said.

While chipmakers scramble to increase production, Intel's plans for new plants will not solve the current supply shortage because such complexes take years to build.

On Friday, Gelsinger reiterated he expected the chip shortages to persist into 2023.

The Biden administration hopes to persuade Congress to grant US$52 billion in subsidy funding to greatly increase chip manufacturing in the United States.

On Friday, US House Speaker Nancy Pelosi said that a bill on competitiveness would be introduced soon in the House of Representatives to help bolster semiconductor investment and supply chains. This includes the $52 billion funding.

US President Joe Biden touted Intel's investment on Friday at a White House event with Gelsinger and again made the case for congressional action.

"China is doing everything it can to take over the global market so they can try to out compete the rest of us," Biden said.

US Commerce Secretary Gina Raimondo said at the event the current semiconductor supply chain is "far too dependent on conditions and countries halfway around the world".

Gelsinger said without government funding "we're still going to start the Ohio site. It's just not going to happen as fast and it's not going to grow as big as quickly".