Intel Corp., the world’s biggest chipmaker, said it will invest as much as $5.5 billion in its plant in Dalian, China, to convert the factory to production of memory chips.

The plant, which began operations in 2010, will begin manufacturing the devices by the second half of next year, the Santa Clara, California-based company said Tuesday in a statement. Intel said it plans to invest as much as $3.5 billion in the next three to five years, which may subsequently increase to $5.5 billion.

Intel, which gets the majority of its sales from processors, has a joint-venture with Micron Technology Inc. to produce memory chips -- called NAND flash -- that store data in mobile devices and increasingly in computers. By shifting computing from its reliance on magnetic disks to semiconductors for storage, Intel is trying to speed up data access and make laptops, servers and desktops more responsive.

In its most recent quarter, Intel said demand for memory chips helped offset weaker demand for personal-computer processors.

Micron said that it may use supply from the upgraded plant and “could have a greater participation in the future.” No formal decision has been announced, the company said in an e-mailed statement.

Intel shares fell less than one percent to $33.43 at 3:37 p.m. New York time. The stock had declined 7.4 percent this year through Monday’s close. Micron’s stock fell 11 percent to $17.35.

By: DocMemory
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