Suppliers, other companies lining up to profit from $20 billion Intel project
Little is known so far about the suppliers and other companies that will come to Columbus or surrounding areas because of Intel’s $20 billion project in Licking County.
The same goes for who Intel will pick as the general contractor in charge of building the two factories, called fabs, that one day will employ 3,000 workers producing semiconductors.
Meanwhile, Ohio businesses stand by and wait, eager to learn more about how they can capitalize in the state’s biggest economic development project in history.
“We’ll be looking for every opportunity to get involved,” said Rodney Porter, owner of Val’s Crane & Equipment Rental in Akron, which bills itself as the state’s only minority-certified crane and lift equipment company.
Intel interest surging among prospective Ohio suppliers
Intel already has received more than 200 statements of interest from construction suppliers, and the company has set up a website where companies can learn more about becoming a supplier.
“There’s been so much positive feedback. People want to be involved in a project that is going to bring more value-added manufacturing to middle America,” said Jackie Sturm, an Intel vice president who heads up the company’s supply chain operations.
When Intel announced its project in January, it identified four suppliers — Air Products of Allentown, Pennsylvania, and Applied Materials, LAM Research and Ultra Clean Technology, all based in California — that have indicated plans to establish a physical presence in the region to support the build-out of the site, with more companies expected.
Otherwise, it’s not the company’s practice to share the names of suppliers, Sturm said.
“We do need to work with everybody. I don’t want to name one guy so that the other guys think there’s nothing left for me,” she said.
The site where the two factories will be built includes 250 acres that have been set aside for suppliers, land that Sturm said likely will be used by suppliers storing chemicals, equipment, packaging material, spare parts and other kinds of inventory that need to be close to the plants. Critical tools used by Intel at the plant can cost as much as $100 million and need to be maintained at the highest levels, she said.
Intel currently has about 140 suppliers in Ohio, and about 30 suppliers are expected to locate operations around the plant, the company has said.
The project in Jersey Township is its first new construction in 40 years and its first U.S. operations outside of the West, meaning Intel is counting on new companies as well as traditional suppliers to build and operate the plant and provide services ranging from human resources to logistics to sales and marketing.
With the queries it has received, Intel is going through a process of determining whether a supplier would work for Intel or be better matched to the general contractor or construction manager. Also, Intel is open to potential suppliers offering niche services the company hasn’t thought about before, Sturm said.
She has found that Intel, based in the Silicon Valley, has plenty in common with the Midwest.
“We share your values. We care about American manufacturing. We care about diversity. We care about environmental stewardship. The kind of work we do, we need to be thoughtful about what our carbon footprint is going to look like,” she said.
She said the work at the Licking County site has the potential to go for years, meaning long-term employment for at least some of the 7,000 construction workers at the site along with some of the companies that will serve them. Intel has said as many as eight factories could be built on the site, representing an investment totaling about $100 billion.
“Our factories, as we build them, have continuous significant investment, upgrading and maintenance that people could make a career,” she said.
That prospect excites Porter, whose company has done work in Columbus.
“A job like that, we’re really in a position to be competitive,” he said.
Intel’s reach will extend far beyond the Ohio plants
Intel’s decision to locate the plants in Licking County will have a far-reaching effect when it comes to jobs.
Intel says for each job it creates directly, 13 more will be created, meaning that the 3,000 jobs at the plants stand to create tens of thousands of additional jobs. The industry average for additional jobs created is 5.7, according to the Semiconductor Industry Association.
Those jobs include everything from working for suppliers to restaurants and RV parks to gas stations and other businesses that will need to grow to accommodate the business because of Intel.
The suppliers that have been identified so far don’t have much to say, or have said it is too early to say what kind of presence they will have on the site.
LAM Research subsidiary Silfex already has operations in Springfield and Eaton that support the semiconductor industry, employing 1,500 workers.
Silfex is a provider of precision components used to make and operate semiconductor manufacturing equipment. It does not plan to put any operations on the Intel site.
The company won’t comment on any plans to hire more workers other than saying it’s encouraged by the growth in the industry.
“Silfex is excited to welcome another strong industry player like Intel to Ohio,” the company said. “We are encouraged by Intel’s decision to invest in the state for increased semiconductor production.”
Ultra Clean Technology said it is too soon to lay out its plans for Intel in Ohio.
“UCT is excited to partner with Intel to help advance domestic, leading-edge chip technology in Ohio. Expanding our presence in the area is a prime opportunity to broaden our footprint, increase our capacity, create jobs, and support the local economy and community,” the company said.