AMD to Invest $5.8B USD into Dresden Fabs
April 5, 2006 6:07 PM
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AMD prepares for a major ramp up this year leading all the way through to 2008
AMD's position as a force to be reckoned is no longer under question. The company has invested significantly over the last several years and made very good bets on its strategy that are now bringing fruits to the effort that was put in.
We previously reported earlier in the year that AMD was putting in a
rough sum of $500M USD to upgrade Fab 36
in Germany. The money was laid out to upgrade the facility to produce larger wafers with smaller lithography processes. Since then, Fab 36 has been operating at a good pace and is now producing a good amount of revenue.
Despite the initial investment, competition often sparks innovation, and innovation doesn't stand still.
According to German reports
, AMD is in the process of rounding up another $5.8B USD which is to be spent gradually up to 2008. The company is using the money to further invest into its Dresden location. If this plan goes through successfully, AMD would have made one of its largest ever expansions in its history -- or for that matter, any semiconductor company.
The money is initially slated for Fab 36 and Fab 30 in Dresden, but the German report indicates much of the earmarked money will also go towards a third AMD foundry in the Dresden area, with work beginning this summer. Some of the funds will also be used for employee salaries at the new and upgraded facilities.
The year so far has been exciting, with many announcements from both sides of the camp. Thanks to first impressions of Intel's upcoming Conroe processor, many analysts are now looking at AMD with a great deal of anticipation to see what the company will come out with next,
specifically the K8L architecture
. AMD is currently on track in terms of timely product releases and expects to deliver quad-core desktop solutions in early 2007. The company recently
broke its own 3GHz barrier with its Opteron family
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Big business motives.
4/8/2006 7:34:25 AM
It's risky to invest that much in Dresden. But if it pays off we'll be looking forward to some big-off cpu power in the near future capable of busting incoming 'meteors' - averting natural disasters. Ha Ha.
4/8/2006 8:02:59 AM
well the reason they built their plants in dresden is the state of saxony there paid for half of them with tax breaks and such , free land whatever, so that they would move there. until fab30 , amd's main fabs were in texas. at the time fab30 was being built, amd was practically bankrupt so they took the deal from germany. i mean german labor is EXPENSIVE even compared to in america. but to get the money to build the fab they went ahead with it.
amd has like no cash. they dont even have 5.8 billion to spend as it is, this is all contingent on them making a ton of money in the next 3 years or selling A LOT of bonds or the germans picking up the tab.
a lot of european nations do this, ireland does too for other factories etc.
that said, they package them in malaysia / philippines etc because labor there is cheap pure and simple.
also to wheover said that the athlon 754 didnt come out till september 2003 or whatever. the opteron was out over a year before that, so the athlon 64 architecture is about 4 years old now.
RE: Big business motives.
4/12/2006 12:18:41 PM
The efficiency gain by having all their stuff (and staff) in one place is much more than the risk of natual disasters.
Think, which one is more likely to occur? A yeild drop that need quick reaction? or a meteor? When the company I used to work for build equipment for their FAB36, they have it designed so that one FAB's cleanroom can transfer their wafer stack (25 of them) in a sealed cassette to another FAB's cleanroom. You can't do that if 2 FAB are 12 timezone away without lots of contamination and time. Another benefit is to reuse resources like administratives, engineeers, HR, shipping, maintanence, and of course, expensive metrology equipments.
"Well, we didn't have anyone in line that got shot waiting for our system." -- Nintendo of America Vice President Perrin Kaplan
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