I hope Intel keeps its US-based fabs and continues to upgrade them. It would be a mistake to cede this capacity to outsourcing like so much of our other manufacturing capacity. Interestingly, it seems the US is almost unique in our mass deindustrialization. Japan, Germany and South Korea have avoided this.
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@3fqa oh my why would everyone at Intel that goes to TSMC want to stay there, because you don’t have to deal with LTD, any questions why intel fumbled the silicon leadership? It isn’t the CEO or the board directly it is LTD, maybe you can blame the Board and CEO for allowing the poisonous deceiving culture to fester there but the reason intel lost its mojo falls squarely in Hillsboro
@ 3fqa+16aTJE9b oh my why would everyone at Intel that goes to TSMC want to stay there, because you don’t have to deal with LTD, any questions why intel fumbled the silicon leadership? It isn’t the CEO or the board directly it is LTD, maybe you can blame the Board and CEO for allowing the poisonous deceiving culture to fester there but the reason intel lost its mojo falls squarely in Hillsboro
Every intel team that switched to TSMC wants to stay there. Intel is a big customer and TSMC customer service is phenomenal. Why would anyone want to work with the Intel fab culture?
Hope is hope, but reality is that a fab s—s up money like nothing else. It requires a very high volume, high unit sales price to keep up. In the integrated device manufacturer (IDM) model, if your device cannot command the kind of volume and price, you die.
Many times before, Intel had poor designs that were saved by the excellent manufacturing technology.
Looking at INTC now, both the design and manufacturing are bad.
Government will never let Intel go. To great of a national security risk. As someone who has worked in the semiconductor industry for 20 years there is what is called "back doors" that can be built into semiconductor architecture. The government knows this and cant let a extremely crucial technology go overseas for risk of this happening on their servers that crunch massive amounts of data. If the government doesnt step in then be worried.
There is a comment above that companies 1/20th the size are "more capable and efficient". Such companies are capable and efficient because they are small.
Im an ex-Intel employee and have worked in other competitor companies. The knowledge and contribution of average employees in those companies is a 10x more than an average Intel employee. For every 1 person who works in Intel there are 5 who are program-mgrs, project-mgrs, mgrs, leads, pretenders, yellers, howlers etc. Many of these guys run 1 meeting a week collect "execution status" and send the minutes without even having the knowledge of what is being executed and why. If you question the stupidity of 're-execution', they will feel threatened and marginalize and finish you. They say they work in 'validation' but they are really doing 'testing'- running a test written by someone else or executing content that is available in the public domain or tests they purchase for $100s K. All of this has been happening from the last 2 decades.
The one thing and the only thing working for Intel was manufacturing leadership and now that has been taken away! Buh-bye
Leadership in semiconductor manufacturing is a matter of national security. So fabs in the US cant become obsolete.
Govt will step in without announcing it; I wouldnt be surprised if secret committees in DC have already been looking at this.
But this doesnt mean Intel isnt screwed, it definitely is. Intel will start selling stuff now and will become the new Motorola. There is stuff like graphics in Intel who will find no buyers! Whatever happened to discrete-graphics dreams!!
They need to look at HR and hiring mgrs. They will find it is a bigger scandal than the college admissions one as far as letting in/ retaining unqualified personnel. Not just technical or degreed positions either. To some extent Intel can get away with it since it's a big company, but it's now out of hand.
Intel fab's need to modernize, companies 1/20 the size of intel are more capable and efficient.
The margins are rapidly disappearing to sustain such inefficiency. Intel needs to look outside and accept that they have not been world class for quite some time. Either modernize both the workforce and systems or watch as manufacturing goes to external fabs.
IMO, Intel is far too large and bureaucratic to modernize and be reborn unfortunately, will be sad to see them die like this, the culture changes that have been promised are not radical nor severe enough to right the ship. Is there enough time to turn this around? Without Jim Keller I am doubtful we even have the right leadership to understand why we are here and the fundamental roadblocks keeping intel in the old broken mindset. Is there anyone allowed to have a critical voice within Intel and backed up to make the needed changes to get Intel out of this hole? It truly is chasing SJW initiatives with passion not seen in the automation and techincal aspects of the company.
What size will Intel’s current ≈110k workforce be in the next 2-3 years? Does not look promising. Tigerlake and Xe will distract and be a very solid product (Is AVX512 needed or will Xe eliminate this costly addition)? When AMD decides to go mobile first and has the OEM relationships locked in, Intel better be ready to compete against Zen3/4, or we will see role reversal where Intel is the budget brand and the superior perks of working for Intel will diminish/die (Sabbatical, QPB, APB, etc...)
This deindustrialization was driven by Wall Street. The important metric is return on invested capital.
Manufacturing companies use a lot of capital for their factories. Shut down the factory and outsource to China, and you have the same sales with a lot less capital, so the stock goes up. Great success.
Maybe repeat by having your suppliers do more and more of the engineering. At a certain point, you are just a brand, with no actual engineering capability.
You can't compete with the people who actually know how to make the things. Then you die. See Hewlett Packard.
The US taxing companies on global income at high rates also has an effect. Say you have 50% of your sales outside the US. You pay taxes in the country where you sell the product. Then you have profits overseas. If you bring that cash back to the US, you pay the difference between the corporate rate in country X and the US, which can be a lot, say 15%. Might as well take that money and use it to pay for manufacturing at e.g. Foxconn. So it's 15% better to invest in manufacturing capacity outside the US.
The poor health care system in the US drives up costs as well, twice what it is in other industrialized countries for worse outcome. Same for cost of housing because zoning laws won't allow building. Google was allowed to build offices in Mountain View but not residential property for the employees to live in. So everyone has to commute from somewhere else, and cost of rent is driven by how much misery you can handle.
Failures in government policy make US workers much more expensive without creating any more value or improving the quality of life for the employees.