US government likely to award $10B in subsidies to Intel
The United States (US) government is in talks to provide Intel Corporation with a subsidy package worth over $10 billion, reported Bloomberg. This package, which is still being negotiated, is expected to include loans and direct grants, according to the report. Both the US Department of Commerce, which oversees the disbursement of CHIPS Act funds, and Intel have chosen not to comment on the matter yet.
Subsidies aimed at boosting semiconductor manufacturing
The subsidies are part of the government's larger $39 billion program aimed at boosting semiconductor manufacturing in the US. Earlier this month, Commerce Secretary Gina Raimondo shared that her department plans to award several funding grants within the next two months. The goal of this semiconductor fund is to support chip manufacturing and related supply chain investments, ultimately helping to build factories and increase production.
Intel plans to invest billions in chip factories
Intel's ambitious plans involve spending tens of billions of dollars on chip factories in Arizona, New Mexico, and a new site in Ohio (which could potentially become the world's largest chip plant). Yet, The Wall Street Journal reported earlier this month that Intel intended to postpone the Ohio site's completion until 2026 due to a sluggish chip market and delayed distribution of federal funds. The influx of federal funds this year might expedite Intel's plans.
TSMC, Micron, Samsung also applied for funding
Moreover, Taiwan Semiconductor Manufacturing Company (TSMC) has sought US funding, with its under-construction chip factory in Arizona recently experiencing delays. In addition to TSMC, Micron and Samsung Electronics have also applied for the same program while building new chip factories in the US.