Intel has invested a total of US$8 billion in Malaysia, and is committing an additional US$6 billion for the construction of new semiconductor facilities there, including a 3D advanced packaging plant, according to Steve Long, Intel GM of Asia Pacific and Japan (APJ) region.
Malaysia, a semiconductor hub in Southeast Asia, has been attracting substantial investments from companies looking to diversify their risks amid intensifying geopolitical tensions.
After more than three decades of development, Malaysia's electronics industry has become a major driver of the country's economy. According to figures released by the Malaysian government, electronics and electromechanical products accounted for 38% of the country's exports in 2021, of which 60% came from Penang.
Malaysia also accounts for 15% of the global capacity for semiconductor packaging and testing, and most of the backend facilities are located in Penang.
In April 2021, the Malaysian government introduced more incentives for the manufacturing and service sectors, boosting investments in the country.
Malaysia stepped up its efforts towards industrialization in 1969, and managed to attract major multinational IT and semiconductor firms to invest in Penang in 1972, laying the foundation for the northwestern Malaysian state to become a semiconductor hub. Those companies included National Semiconductor, AMD, Intel, Osram, HP, Bosch, Hitachi and Clarion. Penang was also the site where Intel set up its first manufacturing facility outside of the US.
In line with its industry transformation and upgrades, Malaysia set up the Penang Skills Development Center (PSDC) in 1989, with support from more than 200 multinational companies. The effort produced skilled labor for the country, attracting even more foreign investment to Penang.
Intel currently has one IC packaging and testing plant in Penang, handling multiple product lines, including CPUs for customer premises equipment (CPE), server CPUs and GPUs.
The upcoming Meteor Lake CPUs adopt Intel's 3D Foveros packaging. Its frontend process is being handled by Intel's plants in New Mexico or Oregon, and the backend process is being handled by the Malaysian plant.
Intel has another two plants in Kulim, Malaysia. One of the plants handles die sort and die prep, and the other provides system integration and manufacturing services.
Long said that Intel is committing US$6 billion to building a 3D advanced packaging plant in Penang and a testing plant in Kulim. The 3D advanced packaging plant will be the biggest of Intel's advanced packaging facility, with volume production expected to begin in 2024-2025, Long said.
Many OSATs are also running manufacturing facilities in Malaysia. Micron, Infineon, NXP, Texas Instruments (TI), STMicroelectronics, Onsemi, Renesas, Rohm, GlobalWafers, Murata and Walsin Technology also have plants in the country.
Osram has wafers fabs in both Penang and Kulim, as well as in Singapore. Fuji Electric, MIMOS Semiconductor, X-FAB Silicon Foundries and Silterra also have wafer fabs in Malaysia.
Article translated by Rodney Chan
