Intel To Spend $100bn In US, After Biden’s $20bn Award

Intel is gearing up to spend $100 billion across four US states to build and expand chip factories, after a notable financial commitment from the Biden Administration.

The American chip giant announced that the federal government (aka the US Department of Commerce) has “proposed up to $8.5 billion in direct funding through the CHIPS and Science Act to advance Intel’s commercial semiconductor projects in Arizona, New Mexico, Ohio and Oregon.”

In addition Intel has been granted federal loans up to $11 billion, making a total of $19.5 billion assistance from the US government. On top of this, Intel “also expects to benefit from a US Treasury Department Investment Tax Credit (ITC) of up to 25 percent on more than $100 billion in qualified investments.”

$100 billion investment

Intel said that these proposed funding numbers will support it’s previously announced plans to invest more than $100 billion in the US over five years to expand American “chipmaking capacity and capabilities critical to economic and national security and acceleration of emerging technologies, such as AI.”

Intel said this $100 billion US investment is expected to create more than 10,000 company jobs and nearly 20,000 construction jobs, and to support more than 50,000 indirect jobs with suppliers and supporting industries.

“Today is a defining moment for the US and Intel as we work to power the next great chapter of American semiconductor innovation,” said Intel CEO Pat Gelsinger.

“AI is supercharging the digital revolution and everything digital needs semiconductors. CHIPS Act support will help to ensure that Intel and the US stay at the forefront of the AI era as we build a resilient and sustainable semiconductor supply chain to power our nation’s future,” said Gelsinger.

Gelsinger later indicated that roughly 25 percent of the $100 billion total would involve building and land, while roughly 70 percent would go to equipment.

The Biden administration predicted that the cash infusion should help America boost its global share of advanced chip production from zero to 20 percent.

President Joe Biden highlighted the investment while visiting Intel’s Ocotillo campus in Chandler, Arizona, where he inspected silicon wafers and reportedly was amazed at how thin the chips are.

“There is no one who cares more about revitalizing American manufacturing than President Biden, and today’s announcement is a massive step towards ensuring America’s leadership in manufacturing for the 21st century,” said US Secretary of Commerce Gina Raimondo.

“With this agreement, we are helping to incentivise over $100 billion in investments from Intel – marking one of the largest investments ever in US semiconductor manufacturing, which will create over 30,000 good-paying jobs and ignite the next generation of innovation,” said Raimondo.

“This announcement is the culmination of years of work by President Biden and bipartisan efforts in Congress to ensure that the leading-edge chips we need to secure our economic and national security are made in the US.”

Land, factories, equipment

The Associated Press reported that Intel’s $100 billion investment will be used in four different US states.

For example in Chandler, Arizona, the money will help to build two new chip plants and modernise an existing one.

Meanwhile the funding will also establish two advanced plants in New Albany, Ohio, just outside the state capital of Columbus.

Intel had in January 2022 announced it would construct the world’s biggest silicon manufacturing complex near Dayton, Ohio.

Intel will also reportedly turn two of its plants in Rio Rancho, New Mexico, into advanced packaging facilities. And Intel will also modernize facilities in Hillsboro, Oregon.

Intel rival Taiwan Semiconductor Manufacturing Co (TSMC) is also building a massive factory in Arizona that it hopes will receive funding from President Joe Biden’s push to bring advanced semiconductor manufacturing back to the United States.