One year after President Biden signed into law the US CHIPS and Science Act, zero dollars have been doled out from the $52 billion for chip manufacturing and research incentives.
The dispersal of the funds is tied up in customary federal review and complexity, but there is no question major companies are competing and continuing to lobby to win a share. Smaller companies are worried about being shut out of the largesse. Research organizations want a greater focus on research and job creation, although some believe other government programs than the CHIPS Act should be used to address a massive need for tech talent in coming years.
Intel arguably has the most to lose in the process, with plans to build new plants in Arizona and Ohio valued at more than $43 billion. Micron also wants to spend multiple billions in New York. US-based chipmakers prefer the CHIPS Act go to US-based businesses over South Korea’s Samsung, with its plans for fabs in Texas and Taiwan’s TSMC with plans for Arizona.
Intel CEO Pat Gelsinger spoke at the Aspen Security Forum in July where he laid out the dilemma: “If Samsung and TSMC and others are building in the US, we should be happy about that. All of my essential R&D is done here. Most of their work is done overseas. We should benefit more.”
In an unusually strident tone, Gelsinger also assailed possible US sanctions on sales into China. “China represents 25% to 30% of our semiconductor exports,” he said in July. “if I have 25% to 30% less market, I need to build less factories. You can’t walk away from 25% to 30% and the fastest-growing market in the world and expect that you remain funding the R&D and the manufacturing cycle.”
The Semiconductor Industry Association recently picked up on the concern about possible export controls on sales to Chinese companies, with decisions on the matter in the hands of the Treasury Department under Biden, while Commerce and NIST will disperse the CHIPS Act funds. “We urge the administration to refrain from further restrictions” the SIA said in statement on July 17. “Allowing the industry to have continued access to the China market, the world’s largest commercial market for commodity semiconductors, is important to avoid undermining the positive impact of this [CHIPS and Science Act] effort.”
On the day of the one-year anniversary of the signing of the CHIPS Act, Aug. 9, SIA CEO John Neuffer was more restrained, but persistent: “Now, with CHIPS on track to deliver massive benefits to our country, it’s critical for leaders in Washington advance policies that enhance this historic achievement. Next steps should include continuing to implement the new law in a timely manner and in close collaboration with industry experts, addressing the significant shortage of STEM workers facing the semiconductor sector and the entire US economy and ensuring the chip industry has open access to global markets.”
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The Commerce Department said it has received more than 460 statements of interest to manufacture semiconductors in the US. Meanwhile, private companies have announced more than $230 billion in chipmaking plans since Biden took office. Commerce Secretary Gina Raimondo told reporters this week: “We need to move quickly but it’s more important we get it right.”
Funding awards are expected to range between 5% to 15% of project capex, while total award amounts are generally not expected to exceed 35% of project capex.