Biden grants Intel $8.5 billion in direct aid for chip plants

Being the tenant of the White House generally grants a great advantage during electoral times.

The president of the United States, Joe Biden, is embarking on a tour in which the official events have something of a campaign feel.

Among them, this Wednesday he took advantage of a visit to Arizona for one of his star announcements: incentives amounting to 20,000 million dollars (just over 18,000 million euros) for the construction by Intel of four microprocessor plants in different States. .

The package includes $8.5 billion in direct aid and about $11 billion in advantageous loans.

Biden has undertaken an economic policy with high doses of protectionism and economic nationalism in which subsidies and reliefs are one of the main exponents.

Through the CHIPS law, it promotes investments in microprocessors;

Through the Infrastructure Law he finances public works, mainly in roads and railways, and through the Inflation Reduction Law he promotes investments in renewables.

CHIPS Act funding aims to increase semiconductor manufacturing, research and development capacity in the United States, especially in cutting-edge microprocessors.

It was passed with support from both the Democratic and Republican Parties in part as a response to the

chip

shortage caused by the pandemic.

Bringing the supply chain closer together became a strategic industrial policy objective.

This law is what protects the aid announced this Wednesday by the White House, in an event in which Biden has traveled to the plants that Intel is building in Chandler, Arizona, one of the six States considered decisive for the presidential elections of December 5. November.

Intel is the only American company that designs and manufactures cutting-edge logic chips.

The proposed financing would help boost Intel's R&D and semiconductor manufacturing projects at its centers in Arizona, New Mexico, Ohio and Oregon, where the company develops and produces many of the most advanced semiconductor chips and packaging technologies. of the world.

The Commerce Department has proposed direct funding of up to $8.5 billion.

Intel also expects to benefit from a Treasury Department investment tax credit (ITC) of up to 25% on more than $100 billion in qualified investments and the ability to qualify for federal loans of up to $11 billion.

These incentives support Intel's previously announced plans to invest more than $100 billion in the United States over five years to expand chip manufacturing capacity in the country and capabilities critical to economic and national security and acceleration. of emerging technologies, such as artificial intelligence.

Intel's investments are expected to create more than 10,000 company jobs and nearly 20,000 construction jobs, and support more than 50,000 indirect jobs with suppliers and supporting industries, according to the company.

Joe Biden (in the center), during his visit to the Intel Ocotillo Campus, in Chandler, Arizona. Kevin Lamarque (REUTERS)

Biden inspected silicon wafers and chips during the visit, noting in amazement how “thin” they were and telling Intel employees: “You are bringing the future back to America,” AP reports.

Commerce Secretary Gina Raimondo said the agreement reached through her Department would put the United States in a position to produce 20% of the world's most advanced chips by 2030, thanks to Intel's investment in facilities in the four Cited states.

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

“AI is driving the digital revolution and everything digital needs semiconductors.

Support from the CHIPS Act will help ensure Intel and the United States remain at the forefront of the AI ​​era as we build a resilient and sustainable semiconductor supply chain to power our nation's future.”

Plants in four states

Intel's investments are concentrated in four different locations in Arizona, New Mexico, Ohio and Oregon:

Chandler, Arizona:

They involve the construction of two new state-of-the-art factories and the modernization of an existing one, which will significantly increase the domestic production capacity of Intel 18A, the company's most advanced chip design, which allows obtaining chips of higher performance.

The company will manufacture the first Intel 18A product, called Clearwater Forest, at its Arizona facility.

In 2022, Intel partnered with Maricopa County Community Colleges to launch a pioneering program with Intel employee-instructors to offer students an entry point into semiconductor technician careers.

This investment will create 3,000 jobs in the manufacturing sector and 6,000 in the construction sector.

Rio Rancho, New Mexico:

Involves the modernization of two factories into advanced packaging facilities, closing a major gap in the domestic semiconductor supply chain.

When fully operational, these facilities will be the largest in the United States.

To support engineering students in New Mexico, Intel established endowed scholarships at five colleges and universities and has supported science education through investments, annual grants, and hands-on learning kits that benefit students living on indigenous lands. .

This investment will create 700 jobs in the manufacturing sector and 1,000 in the construction sector.

New Albany, Ohio:

Creating a new regional chip manufacturing ecosystem, based on building two state-of-the-art factories, expanding foundry capacity, and diversifying the supply chain.

Intel has funded more than 80 higher education institutions across the state to develop a pipeline of qualified workers.

As part of this investment in Ohio, Intel's design and construction partner, Bechtel, signed a Project Labor Agreement (PLA) with the Construction Unions of North America for the construction of the two facilities.

This investment will create 3,000 jobs in manufacturing and 7,000 in construction.

Hillsboro, Oregon:

Investment in the largest state-of-the-art development center in the United States by expanding and modernizing the technology development facility that will utilize the world's first high-resolution EUV lithography equipment.

The Gordon Moore Park campus at Ronler Acres in Hillsboro is the heart of Intel's innovation center for cutting-edge semiconductor technology research and development in the United States.

In 2022, Intel spent more than $4 billion on more than 500 Oregon suppliers.

This investment will support several thousand manufacturing and construction jobs.

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