Intel China revealed via its WeChat account that in addition to increasing packaging and testing capacity for server chips, the Chengdu facility will establish a “customer solutions centre” aimed at improving the efficiency of the local supply chain, supporting Chinese customers, and enhancing response times.

Chipzilla plans to inject US$300 million into its local entity, Intel Products (Chengdu), to support this expansion.

 Launched in 2003, Intel’s Chengdu plant is responsible for the packaging and testing of more than half of the company’s laptop processors shipped worldwide. Packaging and testing is the final step in semiconductor manufacturing, ensuring product quality and reliability.

The facility plays a crucial role in Intel’s global supply chain. Chengdu offers a “favourable” business environment that facilitates the company’s “stable growth”, Intel CEO Patrick Gelsinger noted during a visit last year. Chengdu is the capital of China’s southwestern Sichuan province.

This fresh investment comes less than two weeks after the Cyber Security Association of China recommended a cybersecurity review of Intel products sold in the country, citing a series of vulnerabilities previously discovered in the firm’s central processors. Intel’s China unit responded by stating that it would “maintain communications with the relevant authorities” and demonstrate its “commitment to product safety and quality”.

Despite rising tensions between Beijing and Washington, China remains Intel’s largest market, contributing 27 per cent of the firm’s total revenue last year, compared with 26 per cent from the US.

 Intel warned of “weaker spending across consumer and enterprise markets, especially in China”.

With this expansion, Intel aims to bolster its position in the crucial Chinese market while addressing cybersecurity concerns and enhancing local operational efficiency.