Olongapo SubicBay BatangGapo Newscenter

Wednesday, October 18, 2006

Texas Instruments confirms Asian expansion plans

U.S. semiconductor firm Texas Instruments Inc. the world's biggest maker of mobile phone chips, wants to expand its Asian operations and is scouting for a new production site, a company official said on Tuesday.

"We have to make the decision by the end of the year," Norberto Viera, president and managing director of TI Philippines Inc., told a news conference.

He declined to give details about the size of the expansion or where the new plant would be located.

A Philippine government official said this month that Texas Instruments, which already has a plant in Baguio City in the north of the country, was considering building a $1 billion plant either in the Philippines or China.

"Every country has its own competitive advantage," Viera said, adding that his head office was conducting due diligence on sites, taking into account economic factors and incentives offered by governments.

"At the end of the day, the place TI would decide on will be the place that will make economic sense."

Earlier this month the head of an economic zone in Subic Bay, a former U.S. navy base northwest of Manila, told reporters that Texas Instruments was looking for a 20-to-30 hectare site.

Armand Arreza, the chief executive officer of the Subic Bay Metropolitan Authority (SBMA), said he had offered a 28-hectare area in Subic and that the government would also offer another site, Clark industrial zone, northeast of Subic, for consideration.

But the SBMA administrator said Texas Instruments was also considering locating the plant in China.

Arreza said power costs would be a major factor in the selection of a site. Due to lack of competition and ageing plants, the Philippines has some of the heftiest electricity prices in Asia.

Arreza said Texas Instruments was paying $2 million a month to power its 25-hectare complex in Baguio, 155 miles (250 km) north of Manila. The plant was built in the 1970s and has undergone at least four expansions since then.

The Baguio site manufactures digital signal processors and digital light processors for cell phones plus liquid crystal displays. It is one of the biggest exporters in the Philippines.


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