Intel’s CEO said the Arizona plant was a response to Trump’s business-friendly policies, but the company announced it in 2011 – and Obama gave a speech there

This article is more than 3 years old

This article is more than 3 years old

This week Intel’s CEO used a meeting with Donald Trump to announce it would invest $7bn in building a factory in Arizona, creating about 3,000 jobs.

It seemed like a coup for Trump, who has pledged to bring manufacturing back to the US.

In a media-attended Oval Office meeting, Intel’s Brian Krzanich stood next to Trump and declared that the investment was a response to Trump’s business-friendly policies.

Donald J. Trump (@realDonaldTrump) Thank you Brian Krzanich, CEO of @Intel. A great investment ($7 BILLION) in American INNOVATION and JOBS! #AmericaFirst🇺🇸 pic.twitter.com/76lAiSSQ1l

“It’s in support of the tax and regulatory policies that we see the administration pushing forward that really make it advantageous to do manufacturing in the US,” he said.

Trump was happy to take credit, thanking Krzanich and calling the Fab 42 plant – which will make state-of-the-art computer chips – a great investment in jobs and innovation.

However, the semiconductor company had already announced the same factory back in 2011 when Barack Obama was in power. In 2012, Obama made a speech in front of the building, describing it – to a cheering crowd – as an “example of an America that attracts the next generation of good manufacturing jobs”.

The construction of Fab 42 was halted in 2014, following a slump in PC sales, but analysts don’t believe Trump is the reason it’s been restarted. Instead, the decision to complete work on the factory is likely to be based on industry pressure to move to more advanced types of chips as demand for smart devices surges.

“Now this announcement tonight is probably because of the semiconductor demand we have alluded to in great detail in recent weeks, more than it is about Trumponomics,” Neil Campling, the London-based head of global technology, media and telecom research at Northern Trust Securities, told Bloomberg News.

Intel (@intel) Thanks for stopping by today Mr. President! @BarackObama speaking at the #Intel Fab 42 in Chandler, AZ today pic.twitter.com/uaVvb9jQ

“I call it ‘refried’ news. Intel seems to be selling the same horse twice – first to Obama and now Trump,” said Will Marshall, the president of the Progressive Policy Institute.

“It gives them a chance to bask in presidential favor and show patriotic commitment to investing in America and jobs.”

I call it ‘refried’ news. Intel seems to be selling the same horse twice – first to Obama and now Trump Will Marshall, Progressive Policy Institute

Intel’s pledge comes less than a year after the company revealed restructuring plans that included laying off 12,000 jobs by 2017.

Intel is the latest company to use a meeting with Trump, who has threatened to punish companies that shift operations overseas, to promote domestic investments and job-creation plans that were already in place.



On the eve of a summit between tech leaders and Trump in December, IBM CEO Ginni Rometty unveiled plans to invest $1bn in the US and hire about 25,000 people in the US over the next four years. The news came in the same year the company announced thousands of layoffs.

When Lockheed Martin met with Trump in January, after the president-elect publicly criticized the F-35 fighter jet program for being too expensive, the defence contractor announced the creation of 1,800 jobs. The contractor had previously said it would hire more than 1,000 more workers as production of the F-35 ramped up.

Similarly, Trump claimed a victory at a Carrier plant in Indiana after offering the company $7m in tax breaks in order to save 1,100 jobs at a time when the company was moving even more jobs to Mexico.

Everything you need to know about Trump and the Indiana Carrier factory Read more

“There is a pattern now where he takes credit for corporations allegedly changing decisions to move production offshore or investing here,” Marshall said.

“These are symbolic events – kabuki theater ­– to show a person delivering on his promise to fight for American workers. It makes Trump voters think he’s delivering on his promises.”

Stanford economics professor Nicholas Bloom said that there is no evidence that manufacturing is returning to the US.

“Manufacturing employment was decimated by the great recession with 6 million jobs shredded between 2000 and 2010. Since then about 1 million have come back in a so-so recovery that is now flatlining,” he said.

The “PR announcements” are part of the normal ebb and flow of jobs, Bloom explained. Every year, according to census data, around one million manufacturing jobs are created as another million are destroyed.

“A bigger long-run issue is the rise of the robots – manufacturing jobs around the world including China are being replaced by robots,” Bloom said.

“So Trump trying to stop the inevitable march of technology is his turn at being King Canute – the English king that thought he could command the sea to stop.”

This article was updated to note that construction of the Arizona factory announced in 2011 was halted in 2014 due to a slump in PC sales.