The Biden-Harris administration has done just that announced Intel could receive up to $8.5 billion in potential direct financing to ramp up domestic semiconductor production.
The US Department of Commerce has offered Intel a non-binding preliminary memorandum of terms (PMT) to provide the funding under the CHIPS and Science Act.
The CHIPS Act is a push by the Biden administration to secure domestic chip production, rather than relying on Taiwan’s manufacturing capabilities that could be sabotaged by China.
Billions of dollars for CHIPS
Semiconductor chips are essential for virtually every electronic device, especially when it comes to the latest AI technologies and advanced military capabilities. So it’s not the best idea to have the manufacturing capabilities needed for chip production so close to China.
Intel plans to invest more than $100 billion in its US operations, creating tens of thousands of jobs and securing domestic semiconductor production.
US Commerce Secretary Gina Raimondo responded to the PMT, stating: “There is no one who cares more about revitalizing American manufacturing than President Biden, and today’s announcement is a huge step toward securing America’s leadership in manufacturing for the 21st century.”
“With this agreement, we will help drive more than $100 billion in investments from Intel – one of the largest investments ever in U.S. semiconductor manufacturing, which will create more than 30,000 good-paying jobs and fuel the next generation of innovation.”
“This announcement is the culmination of years of work by President Biden and bipartisan efforts in Congress to ensure that the advanced chips we need to secure our economic and national security are made in the USA.”
The proposed investment would also increase employment and funding for locations in Arizona, New Mexico, Ohio and Oregon through increased manufacturing and distribution facilities. There is also an opportunity for Intel to secure loans from the $11 billion set aside for this purpose in the CHIPS Act.
While the PMT is still subject to change before it is approved by both Intel and the Department of Commerce, this announcement puts the Biden administration within a stone’s throw of completing the goals set forth in the CHIPS and Science Act.