Intel has snubbed its old favourite chum Israel in favour of Ireland.
According to the Israel magazine Globes, Intel is leaning towards Ireland for the upgrade of a fab to production of 15-nanometer technology wafers, which will replace the current 22-nanometer technology wafers made at the company’s Fab 28 in Kiryat Gat.
It all comes down to tax incentives. In June, Intel Israel asked the Investment Promotion Centre for a $600 million grant to upgrade and expand Fab-28. If it got the cash, Intel said that it would create the most advanced fab in the world, and that the company would invest $4.8 billion of its own money in it.
However, this was the fourth grant application since the mid-1990s, and the application was snubbed by the Ministry of Finance and the Ministry of Industry, Trade and Labour.
Government sources told Globes that it was worried that by giving Intel so much cash it was setting a dangerous precedent. It came up with a cunning plan that companies should tender for grant money. However, Chipzilla was not impressed. Competition is something other companies do.
Apparently, Intel has gone as far as it can at its Kiryat Gat, and if the company wants to stay in Israel it would have to go north or move to an “Arab town.”
In July, the Ministry of Finance and the Ministry of Industry offered Chipzilla a small grant if it set up operations in Beit She’a.
Intel decided to upgrade its Irish fab instead. Apparently, the plan is to announce the development around Christmas. It looks like the Irish were more forthcoming with the money. Besides the new fab would bring 1,000 jobs to a country which is not doing very well at this point.
Of course this is not news to us, we have been suggesting that Chipzilla might kiss the Blarney Stone for ages.