Intel Closing Older Plants, Up To 6,000 Workers AffectedIntel Closing Older Plants, Up To 6,000 Workers Affected

Intel, which is coping with a big drop in sales in the PC market slump, said Wednesday that it would restructure some of its manufacturing operations, a move that would affect thousands of employees.

The company did not say how many jobs would be cut in the changes that would take place at four facilities through the end of this year. While the restructuring would involve consolidation and streamlining of operations, it would have no impact on the deployment of Intel's current 45-nanometer line of products or the next-generation 32-nanometer chips, the company said.

Intel planned to halt production at Fab 20, an older 200 mm wafer fabrication facility in Hillsboro, Ore., and to end wafer production at the D2 facility in Santa Clara, Calif. In addition, the company would close two assembly test facilities in Penang, Malaysia, and one in Cavite, Philippines.

The actions would affect between 5,000 and 6,000 employees worldwide. "However, not all employees will leave Intel; some may be offered positions at other facilities," a company statement said.

Intel last week reported that profits in the fourth quarter of last year plunged 90% and revenue fell 23% as the economic downturn hammered sales of PCs and consumer electronics that use Intel products. Besides lower sales, Intel's net income was hurt by a $1 billion net loss in its equity investment in Clearwire, a wireless broadband provider that leverages WiMax technology heavily promoted by Intel.

Worldwide PC shipments fell by 0.4% in the fourth quarter of last year from the same period a year ago, and 2.5% from the third quarter, according to IDC. It was the first quarterly drop in sales in six years.