Example #2: Intel Intel is the world’s leading semiconductor company. It is headquartered in the U.S. and its products i

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Example #2: Intel
Intel is the world’s leading semiconductor company. It is
headquartered in the U.S. and its products include microprocessors,
motherboard chipsets, network cards, etc. In 2009, Intel employed
79,800 people and its sales were $35.1 billion. Besides the U.S.,
Intel has factories in Barbados, China, Costa Rica, Ireland,
Israel, Malaysia, the Philippines, and soon also Vietnam.
Intel is mainly engaged in vertical FDI. While the skilled
labor-intensive part of the production process (e.g. wafer
production) is located in developed countries, the unskilled-labor
intensive part (e.g. assembly and testing) is located in developing
countries. All production facilities are fully owned by Intel.
Why does Intel vertically fragment its production process? Why
does Intel control and manage its foreign production
facilities?