Intel to invest RM30bil over 10 years in its Bayan Lepas FIZ facility

KUALA LUMPUR: Malaysia's electrical and electronics (E&E) sector received a huge boost as Intel Corporation confirmed that it will be plowing RM30bil (USD$7bil) over the next 10 years to upgrade its facility in Penang's Bayan Lepas Free Industrial Zone (FIZ) as well as Kulim, Kedah.

In a joint press conference on Thursday morning with International Trade and Industries Minister Datuk Seri Azmin Ali, Intel Corp CEO Patrick Gelsinger said his company will expand its manufacturing capabilities in advanced semiconductor packaging technology at the Bayan Lepas FIZ.

Intel Corp has a long history of investing in Malaysia, with Intel Malaysia being the first offshore site for Intel Corp, with more than RM22bil invested since 1972.

Intel Malaysia currently employs more than 13,000 personnel, including the country’s largest design and development centre, and one of only two Intel shared services hubs supporting HR, finance, procurement, IT, and supply chain operations to global Intel sites.

Intel Malaysia is also Intel’s largest assembly and test manufacturing site that produces Intel’s latest products utilising smart manufacturing techniques.

According to Azmin, Intel's continuous investment in Malaysia underscores the long-term strategic association between Intel and Malaysia that stretches back for five decades.

Earlier this month, Intel Corp, through Intel Malaysia Sdn Bhd, signed a memorandum of understanding with the Malaysian Investment Development Authority (Mida) to enhance talent development in the E&E industry.

As reported by Bernama, the deal includes human capital development, research and development, expansion of local sourcing, the adoption of Industry 4.0 by E&E ecosystem players, and the deployment of the Intel digital readiness programme.

"The major investment, through their subsidiary, Intel Electronics (Malaysia) Sdn Bhd, augurs well with Malaysia's National Investment Aspirations (NIA), which looks to ensure Malaysia stays at the forefront as a global hub for quality investments while creating high value jobs," said Azmin.

This latest investment bolsters Malaysia's role as a prominent site in Intel's global manufacturing network, and is expected to create over 4,000 Intel jobs, as well as 5,000 construction jobs for Malaysians," he added.

It is understood that Gelsinger, who is on his maiden visit to Malaysia since appointed CEO in January this year, will be at a groundbreaking event at the Bayan Lepas FIZ on Friday.

However, he did not provide a breakdown on the types of the 4,000 new Intel jobs, beyond confirming that some of them will be engineers.

Intel Corp's announcement has been roundly welcomed by a broad range of stakeholders, with Penang chief minister Chow Kon Yeow tweeting: “We are delighted that Intel Corp has decided to invest US$7bil to expand its manufacturing capabilities in advanced semiconductor packaging technology in Penang."

The Intel announcement serves as a good end to the year for peninsular Malaysia's northern region, with much good news provided by the E&E industry.

In a recent statement, the Northern Corridor Implementation Authority (NCIA) said the E&E sector provided the major engine of growth in the Northern Corridor Economic Region (NCER), following the Bayan Lepas-based Intel Technology Sdn Bhd and Intel Microelectronics (M) Sdn Bhd, pledging earlier this year to invest RM4.4bil, which should lead to the creation of nearly 1,600 jobs.

Meanwhile, Batu Kawan-based Greatech Integration (M) Sdn Bhd, a homegrown company that is now a leading solutions provider in the area of factory automation, machinery and equipment in the E&E industry, will invest an additional RM1.6bil on a new operations facility that should be ready to operate within this quarter, while creating 450 jobs.

At nearby Kulim Hi-Tech Park, Infineon Technologies (Kulim) Sdn Bhd will be putting in RM2.65bil in its high-end wafer fabrication facility for semiconductor wafer fabrication that is intended to cater specifically for the automotive and power management technologies, with the investment expected to create 1,815 new jobs.

Malaysia accounts for 13% of global chip packaging and testing, with some 7% of the world's semiconductor trade passing through the country, and along the way, bringing with it some value add at local factories when chips are combined with other parts before final shipment.

In 2020, Malaysia's exports of E&E products amounted to RM386.29bil, or 39.3% of Malaysia’s total exports.
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