Intel to Build $2.5 Billion Chip Plant in China

New Technologies

The 90-nanometer technology is currently one generation behind the most advanced 65-nanometer technology used by Intel. Under pressure from Advanced Micro Devices, which is planning for a shift to a 65-nanometer process later this year, Intel plans to step up the rate at which new process technologies are brought online, hoping to build an insurmountable technology lead over its rival.

Process technologies are described by the size of the average feature -- measured in nanometers, or billionths of a meter -- that can be created and help determine several key attributes of a chip.

Advances in process technology generally allow chip makers to manufacture semiconductors that run faster and consume less power. They can also allow chip makers to shrink the size of a chip, reducing unit production costs and improving profit margins. When chip makers opt to keep the size of a chip the same, the more advanced process technology can free up valuable real estate on the chip for additional capabilities, such as a larger memory cache to improve performance.

Other Intel Chip Plans

Later this year, Intel will begin production of chips using a 45-nanometer process and plans to make chips using a 32-nanometer process in 2009, with a 23-nanometer process planned for 2011. The aim is to introduce a more advanced process technology every other year from now on, according to Intel executives familiar with the company's process roadmap.

That means the planned Dalian plant will likely be two to three generations behind Intel's most advanced plants when it enters commercial production. Even so, older production technologies have a role to play. While most of Intel's factories use cutting-edge process technology, a couple of them still use older technologies, which are measured in microns, or millionths of a meter, instead of nanometers.

For example, one Intel plant in Leixlip, Ireland, continues to produce a mix of logic chips and flash memory using older 0.13-micron, 0.18-micron, 0.25-micron and 0.35-micron technologies. And the company's factory in Jerusalem produces logic and MEMS (micro-electrical mechanical systems) chips using 0.35-micron, 0.5-micron, 0.7-micron and 1-micron processes.

The 1-micron process has been used by Intel since 1989, when it was first used to produce the 33MHz 386 DX processor. Today, Intel uses the 1-micron process to manufacture chips like the 25MHz 186 embedded processor, an enhanced version of a chip that was first introduced in 1982 and is still used in controller applications.