NEC Picks Scotland for New Plant : Technology: The electronics giant says the strategic decision is aimed at increasing production to serve Europe.
Dealing a mild setback to California, NEC Corp. said Wednesday that it will locate a new $800-million semiconductor plant in Scotland rather than in Roseville, Calif.
The giant Japanese electronics manufacturer made it clear that this was a strategic decision aimed at beefing up production to serve the growing European market rather than an effort to escape any perceived disadvantages of the Golden State’s business climate.
NEC already has a thriving plant in the Sacramento-area community of Roseville that employs 1,750 people making 4- and 16-megabit dynamic random access memory chips--components of most personal computers. The new fabrication plant, to be built in western Scotland’s Silicon Glen at an existing NEC site, will produce 16-megabit DRAMs and next-generation 64-megabit DRAMs.
“NEC already has facilities for 64M DRAM production in Japan and a leading edge semiconductors factory in the U.S.; therefore, building such a plant in Europe would be an obvious step towards a more balanced global strategy,” NEC said in a statement.
Al Gianini, executive director of the Sacramento Area Commerce and Trade Organization, expressed mild disappointment at NEC’s decision, issued months ahead of when California officials had been expecting it. But he noted that NEC has been quite happy with production at the 12-year-old Roseville plant and almost certainly will expand there.
“NEC has had significant expansions there over the years; it just spent $250 million on Roseville,” Gianini said. “We’re hopeful we will capture some expansion downstream.”
Two high-level meetings between California and NEC officials are scheduled for October and November in Japan and California, said Bill George, a spokesman for the state’s Trade and Commerce Agency. He said the state is confident that the Roseville site eventually will be expanded.
The planned expansion for NEC’s Livingston, Scotland, plant is expected to create 430 jobs on top of the 940 there now. Output at the new facility, scheduled to hit full production in October, 1996, will reach 20,000 8-inch silicon wafers per month.
Martin Togneri, director of Locate in Scotland, an economic development agency, said Scotland offers grants to assist companies with building and equipment costs and employee training. He declined to provide any specific details about the incentives offered to NEC, but he noted that tax breaks were not among them.
Scotland’s Silicon Glen houses plants of many U.S. semiconductor and computer makers, including Digital Equipment, Motorola, National Semiconductor, IBM, Compaq and Sun Microsystems. Total employment in the country’s electronics industry is 45,300, about 13% of the manufacturing work force.
