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New facility will employ an estimated 4,300 workers

The Republic of Ireland has one of the lowest corporate tax rates in the world -- 12.5 percent.  A common criticism is that while some companies shelter wealth in the European Union state, there's been little return in terms of real jobs.

But Intel Corp. (INTC) is putting not just its money, but its jobs where its mouth is, announcing an ambitious plan for a expansive $4B USD 14 nanometer chip plant, to be constructed over the next two years.

Final approval of the plan is still pending from Intel's board, but assuming it receives their blessing, the project would generate an estimated 3,500 construction jobs and 800 permanent high-tech circuit fabrication jobs.

The plant would expand on a smaller scale test facility dubbed Fab 14 (rechristening it "Fab 24", according to some slides), located in the mid-island County Kildare.  Located in the town of Leixlip, 20 minutes west of Dublin, the current facility employs around 4,000 people.  In early 2011 Intel poured $500M USD into construction at the facility.

Intel clean room employees
Intel's Leixlip facilities [pictured] will be expanded this year to accomodate 14 nm production.
[Image Source: Press Photographers Assoc. of Ireland]

According to documents from the An Bord Pleanála, a local regulatory agency which approved the plan last Thursday, the 14 nm fab will be housed in a brand new building on the existing campus with 244,819 sq. meters of floor space.  101,000 square meters will be devoted to a three-story fabrication facility housing the open-air clean room where the integrated circuits (ICs) will be assembled.  The clean room level will be supported by the two additional utility floors and will be serviced by an air conditioning mezzanine and utility trenches.

Other buildings/structures will be devoted to chemical storage, wastewater storage, diesel backup power generation, a two-story boiler/chiller facility, a runoff retention pond, a multi-story parking garage, and a general purpose support building.

Intel 14 nm fab
The 14 nm fab will be one of Intel's three major global production locations.
[Image Source: Intel]

The local Kildare County Council approved the plan in August 2012.

Intel's 22 nanometer process aired last year in 2012.  The next die shrink to 14 nm arrives next year in 2014.  Retiring Intel CEO Paul Otellini said in May that Leixlip would join a pair of American fabs in Oregon and Arizona as the primary producers of 14 nm product.

The Leixlip facility is expected to play an important ongoing role in future die shrinks, as well, as Intel takes aim at the 10 nm, 7 nm, and 5 nm nodes.  The 14 nm architecture, slated for 2014, is code-named Broadwell; the next die-shrink (10 nm) is dubbed Skymont and is targeted at a 2016 launch.

Samsung Electronics Comp., Ltd. (KSC:005930), a rival chipmaker, is currently testing 14 nm prototypes of its own, and has plans for 14 nm facilities, although its timeline is less clear.  Globalfoundries has promised to deliver 14 nm FinFET chips the same year as Intel -- 2014 -- according to plans announced last September.


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Great
By SlyNine on 1/24/2013 11:13:40 PM , Rating: 3
Can I get a guinness with my computer.




RE: Great
By Samus on 1/25/13, Rating: 0
RE: Great
By diddleydope on 1/25/2013 3:30:34 AM , Rating: 2
Ireland actually has (believe it or not) one of the most highly educated and best trained workforces in Europe.

It0's the reason why there are multiple pharmaceutical and tech companies in Ireland doing ACTUAL R&D and production rather than just offshoring profits.

Just saying.


RE: Great
By alanmcm55 on 1/25/2013 7:24:15 AM , Rating: 3
So nothing to do with Ireland having half the business tax rate as the rest of the EU? IBM Intel and others have all threatened to leave Ireland if they have to pay 'normal' tax rates like every other company in the EU has to pay. Doesn't say much for their opinion of their Irish staff.


RE: Great
By maugrimtr on 1/25/2013 8:41:35 AM , Rating: 5
A) We Irish never work when drunk - we also have stiff rules about driving when drunk (despite some idiots from Kerry thinking this should be optional!)

B) Ireland is not a great manufacturing nation given we're not that far off from the US in terms of employee costs and the usual drivers of outsourcing to China. We lost Waterford Crystal, for example (please do not buy any unless it's clearly marked as actually made in Ireland!), to a private equity group who immediately moved nearly all the jobs to eastern Europe.

C) What manufacturing Ireland does focus on is of a technical nature which is why Intel are based here (and not simply using us as their Dutch Sandwich stopover for profits). You'll also find aviation engineering and maintenance groups, R&D centres for medical groups, and obviously a chunk of factories for the massive Irish agribusiness and food export industries. No car manufacturing - also the DeLorean problem is Northern Ireland's - not the Irish Republic's ;)

D) Ireland's 12.5% corporate tax rate does, obviously, help in any number of ways. And US companies will obviously threaten to leave whenever raising that rate is suggested. Luckily, US Companies cannot fund political campaigns or pump up the government with anonymous money so their mouthing is largely restricted to what ordinary citizens are capable of. In this particular case though, both US companies and Irish citizens are both overwhelmingly in favour of the 12.5% rate being preserved infinitely. Ireland will veto any attempt by the EU to introduce a common corporate taxation base.


RE: Great
By GotThumbs on 1/25/2013 9:00:39 AM , Rating: 2
Thank you.

You post was informative and I think it helped to squash some misperceptions.

While the Web is global, some people appear to have never traveled outside their town/city and have a very limited reality of life beyond their own countries boarders.

Best wishes and Cheers!


RE: Great
By Jeffk464 on 1/25/2013 4:15:25 PM , Rating: 1
What are you talking about I spent 1 to 2 hours in an Irish airport. I'm almost an expert.


RE: Great
By maugrimtr on 1/28/2013 11:04:10 AM , Rating: 2
You're definitely an expert in something. Could you PLEASE assist Ireland in designing a new airport? ;)


RE: Great
By euclidean on 1/25/2013 9:26:00 AM , Rating: 2
Nice post. The company I work for just acquired another that was incorporated in Ireland. So they took that opportunity to re-incorporate the new, entire organization in Ireland as well.

One of the reasons: "...we will benefit from significant global cash management and associated financial benefits available to an Irish company."

So yes, I can only see more and more companies looking at ways to move their incorporation into Ireland...


RE: Great
By Penti on 1/26/2013 8:19:59 PM , Rating: 2
Intel sales obviously isn't run through Ireland and all the testing, package and finishing is done in Costa Rica and Malaysia. The taxes are obviously why some companies has their European sales going through Ireland but Intel doesn't. It's also their low taxes that made Ireland so vulnerable in recent years. Though education and strong academic connections is why you keep advanced fabs in an area. It's why we have semiconductor fabrication in New York, Texas, Oregon, Dresden and so on. As well as design centers in those areas. It's not an investment you just move to another place. It is really hard to invest billions in an region that doesn't have the resources and infrastructure to support your operations. At least you need a large university specialized in the field and a few partner companies in the area around you. A FTZ usually isn't a great fit even in highly educated nations that has the skills in your field.

Though corporate taxes generally doesn't matter when it comes to large or large public companies as they will simply move profits around so they won't be taxed while still having huge profits and paying out dividend. Many companies in countries with 25-30% corp tax will pay less real tax on their profits then companies following the rules in Ireland. Though corp tax is generally not a big earner for their governments any how. Financial companies and shell companies running for sales through is usually a better fit for countries like Luxembourg and Liechtenstein.


RE: Great
By jtcarroll on 1/25/2013 5:32:40 AM , Rating: 4
DeLorean was in Northern Ireland and DeLorean was a crook. http://www.independent.co.uk/news/world/americas/j...

Intel are in the Republic of Ireland.


RE: Great
By ClownPuncher on 1/25/2013 11:23:37 AM , Rating: 1
Spoken like an Englishman.


RE: Great
By Jeffk464 on 1/25/2013 3:19:15 PM , Rating: 2
ah, its a wee bitty chip lass.


Here is an idea
By Orchunter on 1/25/2013 11:46:02 AM , Rating: 2
How about a Special economic zone ( SEZ) which does "corporate-tax" match right here in US. Focus on one area of land where this can be located and then get private sector interested enough with the tax match policy . In India there are already SEZs where corporations are provided temporary ( usually 10 yrs ) tax breaks . Why not attempt something like that here? There are the kind of jobs that US should cling on to . Oh well, I think I should drink some more cool aid now ...




RE: Here is an idea
By Penti on 1/26/2013 8:33:31 PM , Rating: 2
Do you honestly think any sales are going through companies manufacturing sites? They won't put any profits on their books. It's a pointless exercise. Their customer are themselves. It's only relevant to your local carpenter and other small businesses. Which won't set up operations in an asian SEZ. In the EU setting up an SEZ which provides any substantial support is also illegal and interferes with the common market. Plus a major multinational business will get lots of stuff free including land for their properties and roads and so on in the countries with most expensive labor. A SEZ is simply an business selling you industrial plots for you to develop.


I remember the hokey pokey...
By rountad on 1/26/2013 4:53:35 PM , Rating: 2
Are those guys sober?




Come to Taxifornia!!!!!!
By Shadowmaster625 on 1/25/13, Rating: -1
RE: Come to Taxifornia!!!!!!
By ClownPuncher on 1/25/2013 11:27:22 AM , Rating: 2
You need a cold beer.


RE: Come to Taxifornia!!!!!!
By JKflipflop98 on 1/27/2013 3:45:31 AM , Rating: 2
And some tranquilizer.


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