Just 24 hours ago we participated in the annual meeting in which those responsible for Intel in Spain take stock of their business during the year that we have left behind, and also share with the invited journalists your forecasts for the new year. This event has been led by Norberto Mateos, consumer director for the EMEA area and general director of Intel Spain, and one of his statements seemed juicy enough to analyze in this article.
According to Norberto, Intel intends to consolidate itself as the second largest semiconductor manufacturer in the global market. At first glance it may seem that this phrase does not say much, but nothing could be further from the truth. It says a lot. And he says it because it makes something important official: the distance that the Taiwanese company TSMC, which is the largest manufacturer of integrated circuits on the planet, maintains over its two most advantaged competitors, who are none other than Intel and Samsung, is insurmountable in the short and medium term. term.
And at this juncture, Intel has set its eyes on Samsung. Currently, TSMC’s global market share is slightly over 50%, while that of Intel and Samsung ranges from 17 to 20% for both companies. It is clear that a realistic plan requires paying attention to the nearest competitor and taking the necessary steps to distance yourself from it and overcome it. This is precisely what Intel plans to do with Samsung. And the IDM 2.0 strategy () that Pat Gelsinger launched shortly after becoming the general management of this company in February 2021 is everything in this purpose.
IDM 2.0 aims to increase Intel’s competitiveness and reinforce synergies
The steps that this company has taken under the leadership of Gelsinger during the last three years do not only aspire to respond to the needs of Intel itself in the field of semiconductor manufacturing; They also seek to expand their client portfolio and position this company as one of the largest producers of integrated circuits for third parties. The chip manufacturing plant infrastructure that Intel had in 2021 was not sufficient to materialize this double objective, so Gelsinger took the only possible path.
Over the next few years, Intel will invest at least $80 billion in the development of several chip factories.
Intel is making multibillion-dollar investments to expand and strengthen its network of semiconductor manufacturing, packaging, assembly and verification plants. The two factories that it is currently setting up in Arizona (United States) will cost it 20 billion dollars, but this is far from all. It is also building a $25 billion chip factory in Kiryat Gat, Israel; prepares the launch of a 30 billion dollar plant in Magdeburg (Germany); will invest 4.6 billion dollars in new facilities that will be located in Wrocław (Poland), and, finally, it will spend 13 billion more dollars on the expansion of its factory in Leixlip (Ireland).
Intel will not assume 100% of these investments because it will receive juicy subsidies from the governments of the countries involved. Even so, his bet is intimidating from an economic point of view. However, its recipe has one more ingredient that we have not yet investigated: the synergy it maintains with TSMC. Yes, these two companies compete in the field of semiconductor manufacturing, and they will do so even more intensely in the future, but they are also allies.
TSMC also makes chips for Intel. It has been doing this for many years, and this relationship of complicity will endure in the future as an important part of the IDM 2.0 strategy. What’s more, analysts at the financial services company Goldman Sachs argue that Intel will strengthen its relationship with TSMC in the short term referring to this Taiwanese company the manufacturing of part of its semiconductors. According to these technicians, in 2024 Intel will buy chips worth $5.6 billion from TSMC, and in 2025 this figure will increase to $9.7 billion.
We still have to focus on the last major pillar of Intel’s strategy to beat Samsung and consolidate itself as the second largest chip manufacturer on the planet: its intention to develop 5 nodes in just 4 years. At the moment it is on the right track. Several of its plants, including the one in Ireland, are already manufacturing chips with Intel 4 lithography on a large scale. And Norberto Mateos has confirmed to us that nodes 20A and 18A will go into production this year with the purpose of being ready for circuit manufacturing. integrated on a large scale in 2025. Be that as it may, we can be sure of one thing: the competition between TSMC, Intel and Samsung will reach unprecedented ferocity in 2024 and 2025.
Cover image: Intel
