Intel Moves to Expand Chip Manufacturing Capacity in 2019

Intel, the largest manufacturer of computer chips, plans to start expanding a number of factories next year as it attempts to sell a broader range of products to a broader set of customers. With the additional manufacturing capacity on-demand, the firm said that it could reduce the time it takes to increase supply by roughly 60 percent. Intel's move follows a push in recent months to combat shortages of chips used in its core personal computer and data center markets.

"Intel is not just the CPU inside your personal computer," Ann Kelleher, Intel's senior VP of manufacturing and operations, said in a statement. "We are the safety features in your car, the wireless connection in your phone, the intelligence in the cloud." She added: "With the biggest market opportunity in Intel’s history ahead of us"—totaling $300 billion by 2022—"we will take the necessary steps to prepare our global manufacturing network for flexibility and responsiveness to changes in demand."

Despite setbacks with its 10-nanometer process node, Intel has added $1.5 billion in capital expenditures over the last year. The move is aimed at ramping up production of chips based on the 14-nanometer node and taking the pressure off the company's network of factories. Intel projected it would spend $14 billion on capital equipment in 2018, an increase of nearly 20 percent annually. That estimate has jumped to $15.5 billion amid unprecedented demand in PCs and data centers.

Intel announced on Monday that expansions to its manufacturing operations in Oregon, Ireland and Israel are in the early planning phase. The Silicon Valley company also said it will develop a new generation of storage and memory technology at its New Mexico plant. Micron Technology is planning to pay $1.5 billion—and assume approximately $1 billion in debt—to buy out Intel's stake in IM Flash Technologies, the business that they founded together to invent 3D X Point memory.