Intel Corp.’s plant in Rio Rancho has been passed over again for next-generation nanometer chip technology, but the plant is still an integral part of the company’s global production chain, New Mexico site manager Kirby Jefferson told the Albuquerque Economic Forum on Wednesday morning.
“This site was not selected for the 10 nanometer chips, that’s for certain,” Kirby said. “They will do it at other facilities. Seven nanometer is the next one, and we still don’t know where that will be.”
This is the third time New Mexico has been passed over for next-generation chip technology. The Rio Rancho site currently produces 32-nanometer chips, following a $2.5 billion investment in 2009 to upgrade the plant from 45-nanometer technology.
Now, being three cycles behind the curve makes it more difficult to compete for next-generation chips.
“The investment would have to be extremely high here, because we’re so far behind,” Kirby said.
The New Mexico Intel site hasn’t had the latest upgrades in 3 generations and the longer it goes without getting those upgrades the harder it is to get future upgrades. It seems to spell doom for the Intel New Mexico site.
“The New Mexico plant is front and center with what’s going on at Intel,” he said. “Intel is committed to this community. The thinking all the way up the chain is to keep this operation going.”
Call me skeptical. If I was a highly skilled worker at this site I would certainly see doom and gloom and I would be shopping my skills elsewhere, further adding to the decline of the site. If I recall correctly, when Intel was producing the Sandy Bridge processor the Intel New Mexico site was supposedly providing the majority of income to the whole Intel corporation buy producing the majority of those chips while the other sites were ramping up Haswell.
It feels as if the Intel management has kick the Intel New Mexico site to the curb.
Intel Corp plans to reduce its global workforce of 107,000 by about 5 percent this year as the chipmaker, struggling with falling personal-computer sales, shifts focus to faster-growing areas, a company spokesman said on Friday.
The announcement, equivalent to over 5,000 positions, comes a day after Intel posted a fourth-quarter earnings report that did little to dispel concerns about a slowing PC industry.
“This is part of aligning our human resources to meet business needs,” spokesman Chris Kraeuter told Reuters on Friday.
The job reductions may include early retirement, attrition and other options, Kraeuter added. He declined to say whether details of the changes had been announced internally.
I predict more layoffs and not just in New Mexico and it sounds like they will be in the first quarter of 2014.
In its report on Thursday, Intel forecast March-quarter restructuring charges of $200 million, a portion of which could be earmarked for severance pay.
On 11/12/13 I reported to a conference room on the 3rd floor of the RR5 building at the Intel Rio Rancho, New Mexico site. All technicians were to report at their designated time to find out their employment status. My manager stated he had to read from the script and the only part I remember from that script was that “my skills were found to be less than my peers”, or something to that effect. I was notified by my manager that I was “redeployed”, Intel’s term for people that are being laid off. I was told that I would still be employed until 1/15/2014 but that I did not need to come in unless I wanted to.
Intel had announced a few months before that this layoff was going to happen. While I had been mentally preparing myself for it and thinking about what would happen if I did get laid off I wasn’t really expecting to be let go. I had talked to my manger the day before and he didn’t indicate that he was expecting me to be let go. Of course he wouldn’t have any way to know for sure. He wasn’t involved in the decision making process other than to fill out a “skills matrix” of some kind on me. I don’t have any reason to believe that he wrote something like “this guy has no skillz!”. In fact my performance review for the previous year was quite good and my manager was discussing a promotion for me in the next year or two. He was also encouraging me to go to school to finish my degree. Things seemed pretty positive from my point of view.
If I was missing some sort of skills or I was supposed to know something, at least as far as my manger and I was concerned, I think I would have known. This layoff wasn’t supposed to have anything to do with performance anyway. It was supposed to be all skills based. It’s mystery to my exactly what caused me to be on HR’s shit list, but I’m not believing that this layoff was completely skills based.
Intel did a number of things to make this process go easy on the employees. I effectively got a 2 month paid vacation, they waited until the beginning of the year before I was terminated allowing me to get bonuses and other benefits and I get a severance. They could have given no notice and just terminated my employment immediately.
I have moved on and accepted what has happen. It wasn’t easy especially with 18 years at Intel, it hurt. Feelings of rejection and “why me” had a much bigger impact on me than I expected and its hard not to hold a little resentment over how it all went down. But I was better prepared for this layoff financially than the last one in 2006. I am already taking classes to start a career in another industry. Hopefully New Mexico provides jobs in that industry or I may be moving out of state.
The chip giant received $3.3 million in state tax credits from Arizona for creating about 1,000 new permanent jobs with Fab 42, the Arizona Republic noted in a report breaking the news that the facility has been put on permanent hiatus.
Intel has in fact kept its end of that deal, adding more than 1,000 new workers to its payroll in the state—they just work at other Intel manufacturing facilities in the area, according to Mulloy.
Intel is painting its decision not to open Fab 42 as a simple matter of finding a more efficient means of getting to 14nm production at existing facilities. But it’s hard not to see the impact of a slumping PC market on this development—Gartner recently characterized the double-digit drop in PC shipments in 2013 as the “worst decline in PC market history.”
“Due to a shifting market, we are making some difficult business decisions. Specifically, in New Mexico, we have notified employees of a phased process of redeploying up to 400 positions,” company spokeswoman Natasha Martell Jackson said in an email.
The company said it is offering Rio Rancho employees jobs at other Intel locations, buyouts and severance packages to achieve the workforce reduction. Once it becomes clearer how many are willing to take the various offers, the company said it will be able to offer more detail on the reduction.
For the third time in five years, computer chipmaker Intel failed to ensure that 60 percent of the new hires at its Rio Rancho plant are New Mexico residents.
That means the company will have to spend $100,000 toward school-to-work programs, under an agreement it made with Sandoval County.
Liz Shipley, Intel’s government affairs manager in New Mexico, said as technology becomes more complex, the company is having more difficulty finding candidates locally and nationally who have the needed master’s or doctoral degrees in science and engineering.
“It’s not just in New Mexico; we’re seeing a shortage throughout the country,” Shipley told Sandoval County commissioners on Thursday.
A report Shipley presented to the commission showed that about 26 percent – or 19 of the 74 employees the company hired in 2012 – were state residents.
Intel currently has about 3,300 employees at its Rio Rancho plant. The 60 percent hiring goal was one of the conditions the county set in 2004 when it approved a $16 billion revenue bond for Intel.
Intel missed the goal in 2011 and 2009 as well. In 2011, 35 percent of 349 new hires were from New Mexico. In 2009, three of eight new hires were state residents. In 2010, the company’s New Mexico hires were right at the 60 percent mark.