The Biden administration is reportedly engaged in discussions to provide Intel Corp. with more than $10 billion in subsidies, making it the largest award under the plan to bring semiconductor manufacturing back to the United States. The incentives would be part of the 2022 Chips and Science Act, which aims to encourage top semiconductor companies to produce chips domestically by offering direct grants, loans, and loan guarantees.
While the talks are still ongoing, the package for Intel is expected to include both loans and direct grants, according to sources familiar with the matter. However, the exact breakdown between grants and loans has not been determined yet. The Commerce Department and Intel declined to comment on the negotiations.
Intel, formerly dominant in the chip industry, has faced increasing competition from Asian rivals such as Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co. In an effort to stay competitive, Intel CEO Pat Gelsinger has been advocating for government support for the sector. The company has already announced significant investments, including a $20 billion facility in Ohio, a $20 billion expansion in Arizona, and a $3.5 billion investment in New Mexico.
The Biden administration’s goal is to establish at least two leading-edge semiconductor manufacturing clusters in the US by 2030. Since President Biden took office, chip firms have invested over $230 billion in the country. The Commerce Department has already announced smaller grants under the Chips Act and has promised “even bigger announcements” in the coming months.
While the talks between Intel and the Biden administration continue, the potential subsidies could provide a significant boost to Intel’s efforts to regain its position in the global semiconductor market.
FAQ Section:
Q: What is the Biden administration reportedly discussing with Intel Corp.?
A: The Biden administration is reportedly engaged in discussions to provide Intel Corp. with more than $10 billion in subsidies.
Q: What is the purpose of these subsidies?
A: These subsidies are part of the 2022 Chips and Science Act, which aims to encourage top semiconductor companies to produce chips domestically by offering direct grants, loans, and loan guarantees.
Q: How will the subsidies be provided?
A: The exact breakdown between grants and loans has not been determined yet, but the package for Intel is expected to include both.
Q: Has Intel commented on the negotiations?
A: The Commerce Department and Intel declined to comment on the negotiations.
Q: Why does Intel need government support?
A: Intel has faced increasing competition from Asian rivals and is advocating for government support to stay competitive in the chip industry.
Q: What investments has Intel already announced?
A: Intel has already announced significant investments, including a $20 billion facility in Ohio, a $20 billion expansion in Arizona, and a $3.5 billion investment in New Mexico.
Q: What is the Biden administration’s goal?
A: The Biden administration aims to establish at least two leading-edge semiconductor manufacturing clusters in the US by 2030.
Key Terms/Jargon:
1. Semiconductor: A material that has electrical conductivity in between that of a conductor and an insulator, used in the manufacturing of electronic devices.
2. Chips: Short for microchips, these are integrated circuits that contain the electronic circuits and components necessary for the functioning of electronic devices.
3. Grants: Financial assistance provided by the government or an organization that does not need to be repaid.
4. Loans: Money borrowed from a bank or financial institution that needs to be repaid with interest.
5. Loan guarantees: A promise made by the government or a financial institution to repay a loan if the borrower is unable to do so.
Suggested Related Links:
1. Intel
2. U.S. Department of Commerce
3. The White House
The source of the article is from the blog yanoticias.es