US expects to make multi-billion chips awards within the next year
US Commerce Secretary Gina Raimondo said she expects to make around a dozen semiconductor chips funding awards within the next year, including multi-billion dollar announcements that could drastically reshape US chip production.
She announced the first award on Monday (Dec 11) – US$35 million to a BAE Systems facility in Hampshire to produce chips for fighter planes from the “Chips for America” semiconductor manufacturing and research subsidy programme approved by Congress in August 2022.
“Next year we’ll get into some of the bigger ones with leading-edge fabs,” Raimondo told reporters. “A year from now I think we will have made 10 or 12 similar announcements, some of them multi-billion dollar announcements.”
Raimondo said that the number of awards could go higher than 12.
She said she wants the percentage of semiconductors produced in the United States to rise from about 12 per cent to closer to 20 per cent – though that is still down from 40 per cent in 1990 – and to have at least two “leading-edge” US manufacturing clusters. In addition, she wants the US to have cutting-edge memory and packaging production and to “meet the military’s needs for current and mature” chips.
Raimondo noted that the US currently does not have any cutting-edge manufacturing production and wants to get that to about 10 per cent.
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Companies such as Intel, Micron, GlobalFoundries are among those seeking significant funding from the chip programme.
Raimondo said the programme has received more than 550 statements of interest and nearly 150 pre-applications, full applications, and concept plans.
She said that given the extensive interest, there will be many disappointed companies.
“We have national security goals and we need to make our investments to hit those goals and we’re going to do that,” she added.
Congress has allocated US$39 billion for manufacturing incentives to encourage companies to build and expand facilities and awards can be a mix of grants, government loans or loan guarantees.
The department has said direct funding awards are expected to range between 5 per cent to 15 per cent of project capital expenditures and total award amounts will generally not exceed 35 per cent of project capital expenditures. REUTERS
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