US technology company Intel Corp has reportedly been forced to suspend operations at a new factory under construction in Malaysia as the world's largest computer chipmaker grapples with declining sales and mounting quarterly losses.
According to Intel Chief Executive, Pat Gelsinger said the company is still planning to complete the construction of its new advanced packaging factory in Penang.
He also said that they plan to complete the construction of a new advanced packaging plant in Malaysia but will coordinate the start with market conditions and increased capacity utilization.
The expansion project involved an investment of more than $7 billion when it was announced in 2021 when the world was facing a shortage of chips due to the Covid-19 pandemic phenomenon.
The facility is expected to start production in 2024 and create more than 4,000 jobs for Intel in Malaysia.
The company first opened its manufacturing facilities in Malaysia in 1972. The country is Intel's largest site outside the US with approximately 14,000 employees.
However, Intel is now facing its second bigger net loss this year as sales slumped and prompted the company to cut about 15,000 jobs by the end of the year.
In addition, Intel also delayed projects in Poland and Germany for about two years based on expected market demand.
The move is part of a goal to generate $10 billion in savings and create a more competitive cost structure.
