US President Joe Biden’s administration is in talks to confer more than US$10 billion in subsidies to Intel Corp, people familiar with the matter said, in what would be the largest award yet under a plan to bring semiconductor manufacturing back to US soil.
Intel’s award package is expected to include both loans and direct grants, the source said. They stressed that negotiations are still under way.
The US Department of Commerce and Intel declined to comment.
Photo: AFP
The incentives would come from the 2022 Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, which set aside US$39 billion in direct grants as well as loans and loan guarantees worth US$75 billion to get the world’s top semiconductor companies to manufacture chips in the US after decades of production abroad.
Chips firms have invested more than US$230 billion in the US since Biden took office, and the administration’s goal is to establish at least two leading-edge manufacturing clusters by 2030.
Intel dominated the chip industry for years but has recently fallen behind Asian rivals Taiwan Semiconductor Manufacturing Co (台積電) and Samsung Electronics Co, which are building their own US sites in Arizona and Texas. Intel chief executive officer Pat Gelsinger has been the leading industry voice lobbying for US government support of the sector, and the firm has said its plans are contingent on that funding.
Intel is building a US$20 billion facility in Ohio, undergoing a US$20 billion expansion in Arizona and investing US$3.5 billion in New Mexico.
It is not yet clear how Intel’s award would be split between grants and loans, the source said.
Loan terms are company-specific, the source said, as are benchmarks that the Commerce Department would impose to disburse the funding over time.
Intel, based in Santa Clara, California, has not said when its projects would begin commercial production.
The company has made significant progress in Ohio, a spokesperson said after the Wall Street Journal reported a delay from next year to 2026.
An administration official said that the timeline is in bounds with Intel’s initial projections and based on market factors, not award announcements.
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