US To Announce Billion In Subsidies For Advanced Chips: Report

The Biden administration is expected to award billions of dollars in subsidies to top semiconductor companies including Intel, and Taiwan Semiconductor Manufacturing in the coming weeks to help build new factories in the United States, the Wall Street Journal reported on Saturday (Jan 27).

The forthcoming announcements are aimed at kick-starting manufacturing of advanced semiconductors that power smartphones, artificial intelligence and weapons systems, the WSJ reported, citing industry executives familiar with the negotiations.

The executives expect some announcements to come before US President Joe Biden’s State of the Union address on Mar 7, the WSJ report added.

Among the likely recipients of the subsidies, Intel has projects under way in Arizona, Ohio, New Mexico and Oregon that will cost more than US$43.5 billion, the paper said.

Another likely recipient, Taiwan Semiconductor Manufacturing Co (TSMC) has two plants under construction near Phoenix for a total investment of US$40 billion. South Korea’s Samsung Electronics, also a contender, has a US$17.3 billion project in Texas.

Micron Technology, Texas Instruments and GlobalFoundries count among other top contenders, WSJ said citing industry executives.

The US Department of Commerce, Intel, and TSMC did not immediately respond to Reuters request for comment.

In December last year, US Commerce Secretary Gina Raimondo said she would make around a dozen funding awards for semiconductor chips within the next year, including multi-billion dollar announcements that could drastically reshape US chip production.

The first award was announced in December, of over US$35 million to a BAE Systems facility in Hampshire to produce chips for fighter planes, part of a US$39 billion “Chips for America” subsidy program approved by the US Congress in 2022.


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