Intel Moves Jobs Out of Shanghai

Intel (News - Alert) announced yesterday that the company plans to reorganize its China operations that in turn would result in shutting down a Shanghai plant and terminate 2,000 jobs. Those who do lose their jobs however will be offered positions in other parts of the country.

 

The company said today its chip manufacturing facility in the development zone of Pudong, China will be closed over the next 12 to 18 months.

 

"In order to optimize its manufacturing resources in China, Intel plans to consolidate Assembly and Test operations (ATM) from Pudong to Chengdu." the company said in a statement.

 

Intel spokesman Chuck Malloy said that the workers who are expected to be let go will be offered positions at the company's Chengdu plant in the west or the Dalian plant more than 600 miles away from Shanghai.

 

According to CNBC.com, the news comes just days after the world's largest chipmaker said it would close plants in Malaysia, the Philippines and the U.S., cutting as many as 6,000 jobs as quarterly profit tumbled 90 percent.

 

"The decision to relocate is up to the employees," said Nancy Zhang, an Intel spokesperson in Beijing. Zhang said she was not aware of any subsidies or other incentives that employees who choose to relocate would receive.

 

An Intel employee who attended the announcement meeting in Shanghai, where Brain Krzanich, president of Intel's Manufacturing and Supply Chain group, announced the job losses, said workers were upset about the need to move to keep their jobs.

 

Company officials said the moves were necessary "as a result of the current economic conditions" and that its investment in the new $2.5 billion Dalian factory would be increased in order to insure that it has the latest advanced chip technology.

 

The Dalian location is still under construction and expected to begin chip production in 2010. The plant presently has a small number of employees now but is expected to grow, according to Malloy.

 

Intel has already announced the consolidation of several manufacturing and R&D operations around the globe this year to compensate for slower sales in the global recession.

 

After Intel's assembly and test facility is closed in Shanghai, the eastern port city will still be home to an Intel research and development center and the firm's China headquarters.