Over 10 billion US dollars! Chip companies will receive subsidies!

Source: Today‘s Semiconductor Circle

    On February 18th, according to anonymous sources cited by Bloomberg, the Biden administration is in talks with Intel and may provide over $10 billion in subsidies, which is expected to be the largest subsidy to date for the US to promote domestic semiconductor production plans.

    Sources have stated that Intel‘s subsidy plan is expected to include loans and direct subsidies. As this discussion is conducted privately, the source requested anonymity, but emphasized that the discussion is still ongoing and it is unclear the proportion of loans and direct subsidies that Intel receives from the federal subsidy.

    Both the US Department of Commerce and Intel have refused to respond to this.

    The Chip and Science Act, signed by US President Biden in 2022, is accompanied by $39 billion in direct subsidies and $75 billion in loans and loan guarantees to attract top global semiconductor companies to produce chips domestically in the United States. Data shows that since Biden took office, global chip companies have invested over $230 billion in the United States, but the goal is to establish at least two advanced semiconductor manufacturing clusters by 2030.

    The US Department of Commerce has announced two smaller "chip bill" funding projects, including funding for BAE Systems and Microchip Technology‘s US subsidiaries. US Secretary of Commerce Gina Raimondo recently stated that several funding plans will be released in the next two months.

    Intel has previously invested billions of dollars to expand its factories in Arizona and New Mexico, as well as build a large wafer fab in Ohio, which is expected to become the world‘s largest chip factory. However, due to the slowdown in the chip market and slow federal funding, the completion of Intel‘s Ohio factory has been postponed to 2026.