Intel awarded up to $3 billion under CHIPS Act to boost domestic supply chains in US

Intel Corporation has been awarded up to $3 billion in funding under the CHIPS and Science Act, a landmark legislation aimed at boosting semiconductor manufacturing in the United States. The announcement comes as part of the Biden administration's efforts to strengthen the country's technological competitiveness and reduce reliance on foreign chip supplies as detailed in a CNBC report.

Basics of the CHIPS and Science Act, its introduction and role

The CHIPS Act, signed into law in August 2022, provides $52.7 billion in subsidies for semiconductor research, development, and manufacturing. In the act, CHIPS simply stands for Creating Helpful Incentives to Produce Semiconductors. This act was introduced by the US to primarily counter China and maintain its dominance in advanced manufacturing, microelectronics systems, and process technology.

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Intel's award, which is subject to the company meeting certain milestones, will support the expansion of its chip factory in Chandler, Arizona. The facility, known as Fab 42, is expected to produce the most advanced chips using the company's 18A process technology.

"This funding will help accelerate Intel's investment in Chandler and support the company's goal of becoming a major provider of foundry capacity in the U.S.," said Commerce Secretary Gina Raimondo in a statement.

Intel's commitment to US manufacturing

Intel's CEO, Pat Gelsinger, has been a vocal advocate for strengthening the US semiconductor industry. The company has pledged to invest $20 billion in the construction of two new factories in Arizona and another $20 billion for a new facility in Ohio.

"Intel is proud to be a part of the CHIPS Act and to continue investing in US manufacturing," said Gelsinger. "This funding will help us accelerate our plans to build the most advanced semiconductor manufacturing capacity in the world right here in America."

Strengthening the US semiconductor industry

The CHIPS Act is a critical component of the Biden administration's strategy to address the global chip shortage and ensure the long-term competitiveness of the US semiconductor industry. The legislation aims to reduce the country's reliance on foreign chip suppliers, particularly Taiwan Semiconductor Manufacturing Company (TSMC), which currently dominates the global foundry market.

By investing in domestic chip manufacturing, the US government hopes to create jobs, attract more private investment, and secure a reliable supply of semiconductors for key industries such as automotive, healthcare, and defense.

Hence, Intel's award under the CHIPS Act is a significant milestone in the ongoing effort to strengthen the US semiconductor industry. This funding will support the company's expansion plans and contribute to the creation of high-tech jobs in Arizona. As the global demand for advanced chips continues to grow, the CHIPS Act will play a crucial role in ensuring that the US remains at the forefront of semiconductor technology.