Intel to close RP manufacturing plant
Chipmaker Intel Corporation will close its manufacturing plant based in Cavite, Philippines as part of its global restructuring effort. The closure of the Cavite plant will affect 1,800 workers.
According to its spokesman, Intel will close two assembly test facilities in Penang, Malaysia and Cavite, Philippines. It will also halt production of its water fabrication facility in Hillsboro, Oregon and stop some operations at a facility in Sta. Clara, California. The disclosure is said to affect between 5,000 to 6,000 jobs, but added that some employees will be offered positions elsewhere in the company.
Intel has lowered prices on some of its processors, including price cuts of up to 40 percent on some of its higher-powered, faster quad-core chips.
Intel’s local unit, Intel Technology Philippines, Inc., in a statement said, “The impact of the economic downturn on our business was more severe than we anticipated. Our manufacturing operations in Cavite will cease this year. Approximately 1,800 employees will be affected and will be offered a severance package and a range of transition services.” The shutdown will be made in the second half of the year, according to Intel Philippines corporate affairs manager Arlita P. Narag.
Intel has been in the Philippines for 35 years and is the first American semiconductor firm in the country. It has invested over $1.5 billion in the Philippines. It’s Cavite plant is located on a 20-hectare site in Cavite’s Gateway Business Park.
The exit of Intel in the Philippines is a major blow to the country’s semiconductor sector. Arthur J. Young, Jr., Chairman of the Semiconductors and Electronic Industries in the Philippines, Inc., indicated high power rates could be a factor. “We need to find out what went wrong and look at it as an opportunity to make us more competitive. We did this to ourselves because we ignored the things we could have done to make things better for Intel in the Philippines a few years back,” he said, referring to the country’s failure to convince Intel to build a $300 million facility here last year. The company eventually decided to move the investment to Vietnam.
The Department of Labor and Employment issued a statement that it would be offering livelihood assistance to displaced employees from the Cavite plant.
