Intel’s Mobile-Chip Play in Israel

Filed under: — By Aviran Mordo @ 11:39 am

A key government approval for a chip plant in Kiryat Gat could give Intel a leg up in efforts to grab market share from Texas Instruments.

Intel’s plans for making chips that run cell phones just got a big shot in the arm: Israel’s Knesset Finance Committee on Nov. 28 gave the final green light for a $3.5 billion Intel investment in a new semiconductor plant in southern Israel.

Only days earlier, the committee had put off a vote on the project, fueling concern that the decision would be delayed until after Israel’s general elections in late March. The new plant in Kiryat Gat is the largest foreign investment ever undertaken in Israel. Israeli taxpayers will be subsidizing the project over the next decade to the tune of $525 million.

A TOUGH MARKET. But government officials believe the cost is well worth it. “The new plant will create thousands of new jobs and lead to sales of over $3 billion annually once the plant is fully operational,” said Raanan Dinur, director general of Israel’s Industry and Trade Ministry. Israel beat out India and Ireland for the plant, which will produce the next generation of Intel chips.

Source: Business Week


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