Commentary
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Guest commentary by Ivan Houlihan, IDA Ireland
As New Mexico continues to ramp up its semiconductor industry, some companies in the state are turning to Ireland as a new location from which to team with the huge European market, the world’s largest. This gives both places more to celebrate this Saint Patrick’s Day. According to the Semiconductor Industry Association, in 2022, semiconductors were New Mexico’s second ranked export by value at $1.6 billion and there were more than 26 companies in the sector doing business in the state, employing 4,112 workers. New Mexico leaders have been investing to attract companies to their well-located, lower-cost state via business-friendly policies and incentives.
These efforts have drawn some semiconductor industry giants like Intel and electronic design automation leader Cadence Design Systems to New Mexico, joining a growing list of tech companies there. Meanwhile, Ireland is also a prime location for tech companies, particularly those from America. Like New Mexico, Ireland offers a pro-business environment, tax incentives and is also the EU’s only English-speaking nation. As New Mexican tech firms accelerate their customer base, they want to tap into the vast European Union market of 450 million people, often choosing Ireland for a European office, development center or manufacturing plant in order to boost sales and benefit from Ireland’s large talent pool, a magnet for educated workers across the continent.
Ties go back to early days
New Mexico and Ireland have cultural ties that span more than 200 years. As famine in parts of Europe and the lure of gold and silver in the American West attracted many immigrants to the region, multiple Irish were among them, streaming to the Territory of New Mexico in 1850, when it was established by Congress that year. Later, Irish nurses founded St. Vincent’s hospital and St. Elizabeth’s shelter for the homeless in Santa Fe, both longstanding institutions. Among famous Irish in the state’s history were Billy the Kid and Georgia O’Keeffe.
Currently, 6.13% of the state’s residents claim some Irish background and Saint Patrick’s Day is celebrated in a variety of cities with parades. Albuquerque still has an Irish-American Society, annual Rio Grande Valley Celtic Festival and popular pubs like Two Fools Tavern and O’Niell’s in Nob Hill.
Why are semiconductor companies thinking of Ireland?
Semiconductor executives are attracted by the wealth of U.S. companies that have Irish locations, such as tech leaders including Microsoft, Apple, Oracle, Alphabet/Google, Meta/Facebook, Amazon, eBay and Salesforce. The decision by New Mexican corporate executives to launch Irish operations is supported by surveys ranking Ireland as the best country to start a business, highlighted by international insurance provider William Russell in a newly published analysis.
Helping boost semiconductor investments in New Mexico and Ireland are twin “chips acts” that are aimed at increasing semiconductor production in America ($280 billion via the federal government’s CHIPS and Science Act) and Europe (through the EU’s Chips Act, spending €42 billion). The common purpose is increasing the supply of advanced semiconductors in both places, with U.S. firms in New Mexico and Ireland able to tap into this funding.
Intel utilizing New Mexico for future growth
New Mexico is playing a prominent role in ramping up the chip giant’s success, as seen in the opening in January of Intel’s state-of-the-art Fab 9 in Rio Rancho, part of a $3.5 billion investment to equip its New Mexico operations for the manufacturing of advanced semiconductor packaging technologies, including its breakthrough 3D packaging.
The new manufacturing plant along with its Fab 11 location are the first operational site for mass production of these critical technologies. Intel’s presence in Rio Rancho dates to 1980, with a cumulative investment of more than $16 billion in capital.
Ireland is also part of Intel’s strategy
Like many other semiconductor companies, Intel has long used Ireland as a key European location, having invested more than €30 billion since 1989. Intel recently opened a new Fab 34 manufacturing facility where it will begin high-volume production of Intel 4 technology
Cadence putting roots into New Mexico
Computer-aided design systems are a key part of the semiconductor industry and leader Cadence Design Systems has established an important outpost in New Mexico as a result of its 2022 acquisition of Santa Fe-based OpenEye Scientific Software, a leading provider of computational molecular modeling and simulation software being widely and increasingly used by pharmaceutical and biotechnology companies for drug discovery. Now called OpenEye Cadence Molecular Sciences, this merger leverages Cadence’s computational software expertise into molecular modeling and simulation, focused on a lucrative new sector.
Ireland a longtime Cadence location
Cadence began operations in Ireland in 1997 and has a long and successful history in the region. It has a Shared Services Centre in Dublin that employs in senior finance, engineering and IT roles. In 2020, the company announced the opening of a new European R&D Centre of Excellence in Cork to further expand local computational software development. This office facilitates customer design advancement in emerging consumer, hyperscale computing, 5G communications, automotive, aerospace, industrial, mobile and healthcare application areas.
The symbiotic relationship between New Mexico and Ireland has been helping fuel growth and market expansion for the state’s up-and-coming tech industry. Moving to new markets is a critical step in a corporate growth strategy and taking advantage of Ireland’s young, well-educated workforce as well as R&D funding opportunities can help fuel a growing company’s bottom line.
Ivan Houlihan is Senior Vice President and Head of the West Coast of the United States for IDA Ireland, the national investment development agency for Ireland. IDA Ireland partners with companies worldwide to provide financial assistance, on-the-ground support and advice to help companies establish and transform their operations in Ireland. Based in California, Houlihan works closely with existing and potential clients in technology, financial services, life sciences and engineering throughout the Western US and Mexico.