None of the "magic smoke" in those chips is made in China. The "secret sauce" is all done in the US, in Oregon and Arizona. The US turns raw silicon into wafers full of chips. The plants in China, as far as I personally understand, are doing the work of cutting the wafers up, and connecting to mini-PCB boards. They are doing the labor-intensive part of the production, and nothing of the understanding-intensive part of engineering.

I believe Intel tests in Chengdu, they don't need final assembly of CPUs.

Intel also has an Asian fab in Singapore, I think.

They have a Fab (fab 68) in Dalian China for their 65nn process node on 300mm wafers, and an assembly/test site in Chengdu.

https://en.m.wikipedia.org/wiki/List_of_Intel_manufacturing_...

Ah, ya, and Singapore was just flash (did they fab there before), and that is just Micron now to boot.

At 65nm, they aren't fabbing CPU there, probably just supporting chips.

It puzzles me why Intel Chinese fabs are located in such middle of nowhere where their logistics costs will be sky high

Huh?

Chengdu doesn't have a fab and is hardly in the middle of nowhere. Normal logistic costs.

Dalian is in a highly industrialized liaoning province, again highly populated and lots of resources. Again, normal logistic costs.

If they put it in the middle of gansu or qinghai or maybe Northern Yunnan or southern Sichuan (pretty much the Tibetan plateau), that would be the middle of nowhere.

As far as I know (which is admittedly very little), Intel's fabs require massive amounts of stable electricity and clean water. Maybe proximity to such resources is their driver in this case.