back to article Intel’s CEO shouldn’t be surprised America can’t get CHIPS Act together

How serious is Intel about delaying the build-out of its planned $20 billion mega-fab site in Ohio? It turns out very serious, as Intel CEO Pat Gelsinger made clear on Tuesday, less than a week after his x86 giant delayed the groundbreaking ceremony for the Ohio site to show its displeasure over Congress' inability to pass $52 …

  1. Justin Pasher

    True Colors

    The CEO and other industry leaders have rightfully pointed out multiple times that too much of the world's semiconductor manufacturing output is concentrated in Asia now and that the US would be wise to build fabs to create a more balanced global supply chain.

    He acknowledges that too much manufacturing dependency is concentrated in Asia (which is correct) and then says it would be wise for the US to build fabs. But of course he doesn't mean INTEL should foot the bill for that. They only feel compelled to help if the taxpayers give them a bunch of money to accomplish that. It just shows that they don't really care about getting more local manufacturing; they just do what best supports their bottom line. Granted, this is the nature of capitalism, but please don't try to act like you're some white knight trying to save the country and economy in an altruistic way.

    1. John Brown (no body) Silver badge

      Re: True Colors

      Yeah, where's the much vaunted US patriotism and the chants of USA! USA! USA! when he can blackmail the government into footing the bill.

      (No disrespect meant to actual and real US people who are genuinely patriotic, but when it comes to money, business and the business' leaders are only every loyal to their wallets.)

    2. Lordrobot

      Re: True Colors

      Your arguments are flawed and based on flawed assumptions about Capitalism. If a FAB plant was cost-effective in the US, let alone OHIO, it would have been built long ago. You don't need to subside healthy markets. Fax machines and Cell phones never needed Gubberment to pick the winners.

      Just for starters look at what a company is up against: SEC, IRS, FTE, EPA, OSHA, FDA, etc. Then OHIO is not a right-to-work state. IT IS A UNION STATE... look for the UNION Label and sell short. You don't have high tech in Ohio for a reason. You don't have the trained workers.

      On top of that US workers lead the world in employee theft, employee violence against the companies, workplace violence, Worker's compensation, and absenteeism.

      What about local taxes, and dependence on local water, and electricity. Then come the lawsuits... in the most litigious nation on earth.

      Look at INTEL the prize pig of this sty. $80 Billion in stock buybacks over the last decade with nothing to show for it. You are being suckered. Just like the defective can opener that uses that silly CLAIM MADE IN MURICA... or SAVE MURICAN JOBs, or SOLD BY VETS... Those are excuses not the merits of the product. They are claims to elicit sympathy. My view is that it is very unpatriotic to waste taxpayers' money.

      Let Intel go to Europe... Call them on their veiled THREAT. Here, we will help you pack your bags...

  2. VoiceOfTruth

    Subsidies

    Intel's net profit for 2021: $19.9 billion. Give us more money. We need more yachts, hookers, coke, and whatever else. And Fluffy the poodle needs a new manicure.

    1. Anonymous Coward
      Anonymous Coward

      Re: Subsidies

      Free money.... why make chips faster, cheaper and better than competitors, when you can get subsidies endlessly on a vague promise of "catch up with competitors, because if you don't then China wins". Which requires Intel always fail at competing, something Pat is very good at.

      Pat got paid $17.86 million dollars last year, just kidding he got paid $178.6 million. i.e. the profit from tens of millions of ARM chips that Intel cannot compete with on price, is what he got paid.

      1. Yet Another Anonymous coward Silver badge

        Re: Subsidies

        Not just subsidies to build the plants.

        Expect requirements for US government agencies, government suppliers and recipients of US government grants to be required to buy Freedom Chips made in America

        1. Strahd Ivarius Silver badge
          Trollface

          Re: Subsidies

          Freedom Chips?

          Are you speaking of a new name for French Fries?

          (mixing American and English is legal now???)

    2. martinusher Silver badge

      Re: Subsidies

      Back in the 1970s the UK government came up with a great trick. There were a lot of companies that needed investment, either for restructuring or for new investment. Fine, but instead of giving them a subsidy they gave them investment capital -- that is, they got equity for the money. Obviously some investments were a bit naff but others made out very well, the only snag being a change of government at the end of the decade which led to a sell off of these assets, often at prices well below actual value.

      So we should give Intel $52 billion or so.....but then what's Intel going to give us? Surely they don't expect us to just had it over in used $20s in a lunch bag?

      1. John Brown (no body) Silver badge

        Re: Subsidies

        "So we should give Intel $52 billion or so.....but then what's Intel going to give us? Surely they don't expect us to just had it over in used $20s in a lunch bag?"

        While a totally agree with the sentiment, I think the $52B is the total programme budget, not the money on the table just for Intel.

  3. Anonymous Coward
    Anonymous Coward

    Wow, the pressure.

    He isn't getting a load of free money, so now he's threatening and throwing a fit. Go ahead. Built your fabs in Europe. Intel is just as threatened by fabs in the vicinity of China as the US. I'm sure it'd be easier for US lawmakers to pass tariffs on imported Intel CPUs. Their constant push for greater profits is one reason this mess even exists.

    Or maybe the US could tax them with one hand and give them the money back with the other.

    1. Yet Another Anonymous coward Silver badge

      Re: Wow, the pressure.

      But Europe is socialist, he would have to give workers human rights

      Better to stick to a free capitalistic market where the government just gives you free money.

      1. NeilPost Silver badge

        Re: Wow, the pressure.

        “Europe is socialist”…. Can you evidence that ??

        We’ll happily have an Intel Fab in the UK. I would not say our Clown/Fuckwit of a Prime Minister and his appalling Government are remotely Socialist.

        1. Yet Another Anonymous coward Silver badge

          Re: Wow, the pressure.

          >Europe is socialist”…. Can you evidence that ??

          Where government has rules which differentiate between workers and cattle.

          >We’ll happily have an Intel Fab in the UK

          As long as your free capitalist government gives enough free capital to the company, that can be arranged

          1. NeilPost Silver badge

            Re: Wow, the pressure.

            That’s not socialism…that’s the difference between employment and servitude. Even the US/Canada have some employment rules- just nit enough… hence recent Apple and Amazon unionisation victories.

            Question - has EU membership and workers rights damaged German competitiveness, and global reach ?? Say for example ownership of the North American International Trucks business via Navistar -> Traton -> Volkswagen AG or Mercedes and Freightliner/Western Star/ThomasBus and the ubiquity of BMW and Audi vehicles in USA.

        2. John Brown (no body) Silver badge

          Re: Wow, the pressure.

          “Europe is socialist”…. Can you evidence that ??

          Easy. It's Simplified American for allies who we sort of like but not really because they aren't American.

          Everyone else are either Commis or fascists.

    2. tekHedd

      Aspen Ideas Festival

      "throwing a fit" ...at a week-long festival in Aspen.

      Yeah, these bigwigs have it rough.

  4. ecofeco Silver badge
    FAIL

    Insert words not fit for family viewing, here

    The VERY company that shut down its fab plants and failed to invest in new ones, now wants taxpayer money for their mistake?

    Go on, guess what I'm thinking!

    1. OldCrow 1975

      Re: Insert words not fit for family viewing, here

      BULLSEYE!

      1. John Brown (no body) Silver badge
        Coat

        Re: Insert words not fit for family viewing, here

        ...and here's what you could've won!

        The one with the darts in the pocket ------------>

  5. Warm Braw Silver badge

    Other governments are waving cash around

    A couple of high-level phone calls citing national security and unspecified future measures would likely sort that out.

    Seriously, though, Intel's total value is around $160bn. $52bn in the US alone is (in principle, I know fabs are hard and depend on accumulated knowledge and experience) enough to create a serious rival to Intel. Presumably a better tactic than massive subsidy would be to explain the many ways in which a business might suffer in the absence of cooperation?

    1. chasil

      TSMC & RCA

      It's important to understand that RCA agreed to train TSMC workers in the late 70s at the RCA semiconductor foundry in Ohio.

      TSMC acquired vast experience from RCA.

      RCA was a leader in semiconductor manufacturing at that time, but attempted to become a conglomerate with acquisitions of unrelated businesses that detracted from their core competence. The nickname of the firm was "Rugs, Chickens, and Automobiles" as they bought a carpet company, a frozen food company, and a rental car company.

      RCA as a semiconductor manufacturer withered on the vine in the ensuing management distraction.

      There are many reasons that TSMC would never survive in the United States. Perhaps Intel is better served in another country.

      1. Yet Another Anonymous coward Silver badge

        Re: TSMC & RCA

        TSMC was founded in 1987 by a guy who spent 25 years as a very accomplished semiconductor expert at TI

        1. chasil

          Re: TSMC & RCA

          https://meet-global.bnext.com.tw/articles/view/47727

          "RCA invited a team of some 30-40 engineers to their campus for a year to teach them not just the raw science of semiconductors but also management techniques and industrial knowledge... a few years later, RCA pulled out of the semiconductor industry altogether and left Taiwan with a license for all of its technologies."

          1. chasil

            Re: TSMC & RCA

            After reading that whole article, all of RCA's technology actually went to UMC.

            TSMC got something better:

            "TSMC entered the market with technology much more advanced than UMC... Dutch corporation Philips (continuing a history of close Dutch-Taiwanese ties) provided technological input on the 1.5 micron process that would make up TSMC's core service."

            I didn't know that.

  6. Pascal Monett Silver badge
    Mushroom

    Waah waah waah

    You not gonna gimme money ? Me upset !

    (calling my banker to see just how big a bonus I can take this month)

  7. fajensen
    Mushroom

    My schadenfreude over watching America circling ever closer to the drain is somewhat tempered by the fact that, once does go down, we will have a "White Taliban" country with about 800 millitary bases and thousands of nukes!

    1. ecofeco Silver badge

      Outside agents intent on America's failure would do well to remember this.

      I have my own, numerous gripes about America, but ultimately this is the main reason. If it fails, it becomes a 2nd world, theocratic, rogue nation with thousands of nukes.

      That's not good for anybody.

      1. katrinab Silver badge
        Meh

        I don't want the country to fail. I want the current regime to fail, and be replaced with something better. Something actually democratic and not captured by campaign contributions and far-right religious nutters.

  8. Yet Another Anonymous coward Silver badge

    >White Taliban" country with ...thousands of nukes!

    Although targeted by people who believe the Earth is flat

    That, once they purge all the foreigners and atheists, they will be maintained by people who don't believe on book-lerning may or may not be reassuring

    1. NeilPost Silver badge

      … where does foreigner (heritage) purge stop ?? At Eskimo’s and (American) Indian’s ?

      Will you also revoke the Louisiana Purchase, American/Mexico War, Alaska Purchase too and back to the true Core (ex-British) America when the Constitution was codified ??

      1. Yet Another Anonymous coward Silver badge

        Put it this way, there weren't many WASPS on the Manhattan project.

  9. Anonymous Coward
    Anonymous Coward

    Waaaah!

    Don't let the doorknob hit you where the Good Lord split you.

  10. msobkow Silver badge

    Wah! We want our pork! We deserve a barrel just like the military! :(

  11. stiine Silver badge
    Mushroom

    Tough

    Tell him, his shareholders, and his board of directors to fuck right off, and then stop buying Intel hardware.

  12. EricB123 Bronze badge

    Free markets, my sorry ass

    So, whomever fleeces the taxpayers the most...

  13. Lordrobot

    IF the GUBBERMENT Doesn't give us money we we we will go to EUROPE... and show you... Yeah Yeah Yeah

    Intel, not the company of NOYCE, MOORE, or GROVE, is now a carnival barker or tent revival camp meet'in... gold tooff grifter.

    This is truly pathetic. What next, the throwing off of crutches and Intel Execs doing the Chicken Waltz across the stage for JYSUS?

    The primary metaphor is sick. Look no further than the OBAMA BATTERY FACTORY GIVE a WAY extravaganza... Startups took Billions and not one battery was built not one battery factory was built. But but but it was going to bring the Battery world to the USA. The USA was going to lead the way in Batteries from mean ole CHINA.

    Now we play the Biden Loop... FAB FACTORIES for Free... This will show CHINA and KOREA... Everyone will be coming to the USA and especially INTEL for FAB. After all why wouldn't a fabless designer give INTEL its drawing and technical designs? Not to mention that INTEL folded on its 10nm Fab. Oh but but but that was different. All those ills will be fixed by building FAB in Ohio.

    Who is going to buy these new OHIO FAB chips? NOBODY. They will have no market in Asia at all. Why? The US might sanction US FAB chips from being sold in ASIA.. Isn't that the lynchpin of this crazy US protectionist scheme and sanctions? Newsflash, if you can't sell Chips to Asia, they will sit on a shelf in Ohio and ROT.

    The protectionist arguments are dumb as Trump. It is the legerdemain that division of labour means DEPENDENCE and if the US was dependent some other country might deploy the same Nancy Kerrigan Foreign Policy kneecapping sanctions against the USA. Oh, how awful that would be... So the US needs to make its own FAB and its own overpriced batteries, and its own overpriced solar cells, and it's own overpriced [Fill in the Blank.]

    Division of labour is a form of detente. You have to get along with others to make it work. That is not the US-style. The US form of business is victim to executioner. The fact that the US controls ASML sales and INTEL sales and Qualcomm sales and ARM sales and yet doesn't or can't make anything themselves is amusing. But it gets more amusing as the US pushes China and other Asian Countries into this quasi US RACE WAR. After all, isn't it really the Anglosphere vs Asia.

    What happens to Taiwan once the US no longer needs TSCM fab? Say goodbye to the Biden Claim that US forces will land to defend Taiwan. Taiwan would have no more value to the US demigod. Just as ASML will have no more meaning to the US, once China develops its own EUV FAB or some carbon-based technology.

    Here is the problem protectionist and it is simple to grasp. China is the largest buyer and user of semiconductors. If you can't sell your chips in China or Asia because they COULD be sanctioned from China by the US... you have no sales. Right now while you are screaming about narrow gated fab, China is focused on the other 95% of the chip market and now can roughly provide 80% of its own needs in that regard. While Biden and INTEL and the protectionists are raising a fuss over 5% of the market.

    The US is going to lose this, just like they lost Steel, textiles, and Chemicals, consumer electronics, cameras, electric cars, and autos to Asia. Asia has no UNIONS. OHIO by the way is NOT A RIGHT TO WORK STATE.... so FAB will never work in Ohio. Fab is highly manpower-dependent. Joe loves UNIONs so maybe INTEL FAB will be run by high-quality UNION workers left over from the UAW when FORD left for Mexico and China.

    Protectionism is essentially raising the white flag that you can no longer compete. Karl Lagerfeld put it more succinctly, “Sweatpants are a sign of defeat. You lost control of your life so you bought some sweatpants.” YOU LOST YOUR CONTROL SO YOU BEGGED THE GOV TO BUY YOU A FAB PLANT in Union-controlled OHIO...

    Throw off those crutches and do the INTEL Chicken DANCE!

POST COMMENT House rules

Not a member of The Register? Create a new account here.

  • Enter your comment

  • Add an icon

Anonymous cowards cannot choose their icon

Other stories you might like

Biting the hand that feeds IT © 1998–2022