November 9, 2004 7:03 AM PST

AMD turns to Chartered for help

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Advanced Micro Devices has chartered a new chip manufacturer.

The Intel rival known for its Athlon PC and Opteron server processors announced on Tuesday plans to tap Chartered Semiconductor Manufacturing, a contract manufacturer, for extra chip-production capacity.

The two companies signed a manufacturing and technology-sharing agreement under which Chartered will produce Athlon 64 and Opteron chips starting in 2006 to help AMD meet expected demand. Singapore-based Chartered will use AMD Automated Precision Manufacturing software, which AMD created to better manage its chip manufacturing processes.

AMD's share of the PC processor market inched up to 15.8 percent during the third quarter. AMD generally aims to take a larger piece of the PC and server markets from rival Intel and thus expects to need more production capacity over time.

Sunnyvale, Calif.-based AMD feels the need for additional capacity that Chartered can offer--despite the fact that AMD is building a new processor factory of its own. The new plant, dubbed Fab 36, will sit alongside AMD's existing Fab 30 in Dresden, Germany.

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