Semiconductor History | Bayan Lepas — Intel's First Factory Outside America, and the Fire That Took It

In early 1972 a consultant talked Andy Grove into looking at an island off the west coast of Malaysia, where the land Intel went on to build in was still growing rice.

Intel put US$1.6 million into a five-acre site in Bayan Lepas and opened the plant it called A1 that year with about a hundred employees, its first production facility anywhere outside the United States.

The staff wore batik, in a pattern made for the factory.

The photograph here comes from Intel's own archive: a line of young women at binocular microscopes, bonding wires from chip pads out to lead frames, which in 1972 was work that human hands and eyes did better and far more cheaply than any machine.

That is what offshore assembly meant, and this is where an American chip company first tried it.

It worked quickly. By 1975 the plant employed around a thousand people and Intel's production schedule depended on it.

Then, a little after nine in the morning on 1 May 1975, a fire started in the mould room, probably from a faulty light fitting.

Within an hour the building was gone. Intel's own account of the day is that only the cafeteria was left standing, and that even the steel frame had burned.

Nobody was hurt, because the plant happened to be closed that day.

The damage came to about US$2.5 million, more than Intel had spent building the place three years earlier, and production did not resume in Penang until 1976.

Intel stayed.

The site grew into a campus of around ten buildings holding one of the company's largest assembly and test operations and its largest design and development centre in Malaysia, and in December 2021 Intel broke ground on new production buildings in phase three of the free industrial zone, part of a US$7 billion commitment across Penang and Kulim.

Nothing marks where A1 stood.

The building burned, the paddy field is now an industrial estate with dual carriageways through it, and the surviving picture of the first shift is a photograph the company put on Flickr four decades later. This memory is pinned at the current Intel buildings on Halaman Kampung Jawa, not at the lost one.

Photo: Intel Free Press, CC BY-SA 2.0, via Wikimedia Commons.