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Oregon, New York may be competing for Apple chip factory

updated 10:58 am EST, Wed December 19, 2012

Sites in Texas, California also allegedly under consideration

The states of Oregon and New York may be competing for a chip factory under consideration by an Apple supplier, says The Oregonian. Oregon's economic development agency, Business Oregon, says it is trying to recruit a company operating under the codename "Azalea." A non-disclosure agreement is preventing any more details from emerging, though a similar project --tagged with a "Project Azalea" codename -- is being pursued in New York state.

An Oregonian source "with knowledge of Azalea but not authorized to speak about it" backs the idea that both projects are connected. The factory is said to have been discussed in the Oregon state capitol last week, at the same time as politicians were working on a law meant to lure Nike into expanding in the state. Consulting firm Deloitte Touche Tohmatsu has also reportedly been looking at sites for Azalea in Texas and California.

The supplier in question is believed to be TSMC, which for some time has been rumored as gaining more Apple orders as the latter tries to reduce its dependence on Samsung. TSMC already has a factory it could expand in Camas, Washington, but there's said to be no evidence of interest in the area from Azalea. Washington development officials say they haven't heard anything.

The Oregonian notes that New York may have the edge in attracting Azalea. While Intel has been enjoying property tax exemptions in Oregon valued at over $500 million, New York is said to be offering even greater handouts to corporations, such as $2 billion in incentives to manufacturer GlobalFoundries. The state has a larger economy and budget than Oregon; conversely though, Oregon has an established semiconductor industry with better infrastructure and more suppliers.

New York Governor Andrew Cuomo has recently hinted that the facility Project Azalea plans to build could be some some 3.2 million square feet, saying last Monday on a radio interview (when asked if Apple was behind or involved in the proposed factory) that "we're shopping a lot of different companies at any given time." He added that "Apple has a lot of competition, obviously, for their location. I don't think that they're anywhere yet in the decision-making," giving away that New York has at least been in some conversation with Apple or its partners about a facility in the state.

The unknown firm has so far scouted the Luther Forest Technology Campus in Malta, and the Marcy NanoCenter in Oneida County in New York. Currently, the A-series processors used in iPhones, iPods, and iPads are made at a Samsung plant in Austin, Texas, but the new facility -- if rumors turn out to be correct -- could bring an expansion of jobs related to chip engineering and manufacture to the US.

by MacNN Staff



  1. Inkling

    Senior User

    Joined: 07-25-06

    Corporate execs are often so drawn in by large tax subsidies, that they fail to notice that the state is going to get its money someway. Most likely that's going to come out of taxes on employees, their incomes, their homes, and what they purchase. Apple will either have to pay more, a lot more, to make up for that or see potential employees got to competitors. The smart move is taxes where overall taxes are low and regulations reasonable.

    New York has two other downsides.

    1. Californians may not be aware, but people in the rest of the country now value sun and more temperate climates that allow them to spend more time outdoors. The Northeast US loses out on climate in every imaginable way. The summers are as hot as anywhere else, while the winters are long, cold and expensive.

    2. Upstate New York and parts of nearby states are troubled with what's called the Lake Effect. It means sudden snow storms that dump feet rather inches of snow, bringing everything to a halt. People can't get to work. Those newly made chips or Macs can't get to customers.

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