Intel pulls the brakes on projects in Poland and Germany
On Monday, US semiconductor manufacturer Intel said that it is postponing its plans to build two mega chip plants in Magdeburg, Germany and its plans in Poland due to lower demand than expected.
In the statement, Intel CEO Pat Gelsinger, says that the company recently increased capacity in Europe through its fab in Ireland, which will remain the company's lead European hub for the foreseeable future.
"We will pause our projects in Poland and Germany by approximately two years based on anticipated market demand," he continued.
Adding to this, the company also plans to slow down its expansion in Malaysia. Intel will complete the construction of its new advanced packaging factory in Malaysia but will align the startup with market conditions and increase utilisation of its existing capacity.
"There are no changes to our other manufacturing locations. We remain committed to our U.S. manufacturing investments and are moving forward with our projects in Arizona, Oregon, New Mexico and Ohio," Gelsinger said in the statement
Intel is cutting costs, as the company looks to create a more competitive cost structure and deliver the USD 10 billion in savings target the company announced last month. The goal is to build a leaner, simpler and more efficient Intel.
Gelsinger continued to say that the company is more than halfway to its workforce reduction target of approximately 15,000 by the end of the year – mainly through voluntary early retirement and separation offerings.
"We still have difficult decisions to make and will notify impacted employees in the middle of October. Additionally, we are implementing plans to reduce or exit about two-thirds of our real estate globally by the end of the year," Gelsinger concluded.
