WASHINGTON — WASHINGTON (AP) — The Biden administration is providing $162 million to Microchip Technology to support domestic computer chip production — the second funding announcement tied to a 2022 law aimed at revitalizing U.S. semiconductor manufacturing.
The incentives include $90 million to upgrade a plant in Colorado Springs, Colorado, and $72 million to expand a plant in Gresham, Oregon, the Commerce Department said. The investments would enable Microchip Technology to triple its domestic production and reduce its dependence on foreign factories.
Much of the money would finance the production of microcontrollers, which are used by the military as well as in cars, home appliances and medical equipment. Government officials said they expected the investments to create 700 jobs in the construction and manufacturing sectors over the next decade.
Lael Brainard, director of the White House National Economic Council, emphasized that the funding would help curb inflation.
“Semiconductors are the key input for so many goods that are vital to our economy,” Brainard said, adding that increased U.S. production of chips would have eased the supply problems that have caused the costs of cars and washing machines to rise, among other things . as the country emerged from the coronavirus pandemic in 2021.
The inflation rate has since eased, but the scars caused by the sudden price increases have damaged President Joe Biden's public approval.
In August 2022, Biden signed the bipartisan CHIPS and Science Act, which provides more than $52 billion to boost semiconductor development and manufacturing in the United States.
In December, the Commerce Department announced the first grants, saying it had reached an agreement to provide $35 million to BAE Systems, which plans to expand a New Hampshire factory that makes chips for military aircraft, including F-15 and F-35 jets.
Government officials expect to make additional funding commitments this year.