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Intel Fights Back: CHIPS Act Will Benefit The US Semiconductor Industry

Thomas Grillo

‘This includes both manufacturers and the fabless companies that today do most of their manufacturing offshore, and which stand to gain a wider range of cost-competitive, US-based manufacturing options,” Intel says.

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Intel Corp. is fighting allegations that the $52 billion semiconductor manaufacturing and research spending package known as the CHIPS Act will primarily subsidize the Santa Clara, California-based multinational tech giant.

Intel, in a statement to CRN, said the CHIPS Act will benefit the entire American semiconductor industry, and not just the leading-edge semiconductor manufacturing part where new fabs require $10 billion to $12 billion in investment each.

“This includes both manufacturers and the fabless companies that today do most of their manufacturing offshore, and which stand to gain a wider range of cost-competitive, US-based manufacturing options,” Intel said. “The CHIPS Act will also benefit all the American industries that depend upon semiconductors for their products.”

[RELATED STORY: INTEL NOW PREPPING OHIO SEMICONDUCTOR FAB]

The Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America Act was approved by Capitol Hill lawmakers 18 months ago. It incentivizes investment in the nation’s semiconductor sector with billions in subsidies and an investment tax credit to increase U.S. manufacturing.

But so far, funding for the measure has failed to win the Congressional green light.

Its passage signaled recognition by federal legislators that the U.S. semiconductor industry plays a crucial role in America’s future.

The Semiconductor Industry Association (SIA) has reported the share of semiconductor manufacturing capacity in the U.S. has slipped to 12 percent, down from 37 percent in 1990. The trade group said the nation’s role in chip making has dwindled, primarily because other countries’ governments have invested heavily in chip manufacturing incentives while the U.S. government has not.

Reuters reported several major U.S. semiconductor firms are considering whether to oppose the incentive package as the final version of the bill awaits a Senate vote, as early as Tuesday.

The report said Advanced Micro Devices, Nvidia, and Qualcomm, may oppose the measure because they allege it heavily favors manufacturers, including Intel.

Nvidia and Qualcomm did not respond to a CRN request for comment by press time. AMD declined to comment.

Last month, it was reported that Intel has officially acquired the land it needs to build its Ohio-based semiconductor manufacturing facilities despite earlier reports that the company is delaying the plant while waiting for Congress to release funding to support a U.S.-based semiconductor industry.

Intel has spent $111 million on 750 acres of land near New Albany, a suburb of Columbus, Ohio, according to a report Wednesday in the Columbus Dispatch.

Joseph Kovar contributed to this report.

 

 

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Thomas Grillo

Thomas Grillo covers chips and the Internet of Things for CRN. He has covered the residential and commercial real estate sectors for The Boston Globe, Boston Herald, Boston Business Journal, Banker & Tradesman, and Lynn’s Daily Item. He can be reached at tgrillo@thechannelcompany.com.

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