Intel Plans to build its $20 billion semiconductor factory in the US have reportedly been delayed over the Chips Act. The chip maker said it is yet to move forward with the groundbreaking Ohio facility because of delays in the Chips Act. “unfortunately, Chips Act Funding has proceeded more slowly than we expected and we still do not know when it will be done,” Intel said in a statement. However, the chip giant clarified that it is still planning to begin construction on the project this year. is planning, and manufacturing should begin by 2025.
What is the Chips for America Act
The Creating Auxiliary Incentives to Make Semiconductors (CHIPs) Act is a $52 billion funding package for US domestic chip manufacturing. America managing committee Passed a version of the bill in 2021, but it has not yet received approval from the US President Joe Biden, Here is the summary of the bill US Congress Website:
* The bill establishes investments and incentives to support US semiconductor manufacturing, research and development, and supply chain security.
*Specifically, the bill provides for income tax credits for semiconductor equipment or manufacturing facility investments through 2026.
* The Bill also establishes a trust fund to allocate to foreign government partners to reach an agreement on (1) compatibility in policies relating to microelectronics; (2) transparency in microelectronics supply chains; and (3) alignment in policies towards non-market economies.
* The US Department of Commerce, through the National Institute of Standards and Technology (NIST), will drive a program of research and development investment to accelerate the design, development and manufacturing capability of next-generation microelectronics, including the creation of a manufacturing . USA Institute for Semiconductor Manufacturing. Commerce will also establish a program to match state and local government incentives given to private entities for the purposes of building manufacturing facilities related to semiconductor manufacturing. In addition, commerce will assess the capabilities of the US industrial base to support national defense in light of the global nature of supply chains and interdependencies between the US and foreign countries’ industrial bases with respect to the manufacture and design of semiconductors.
* The Department of Defense will prioritize the use of specified available funds for programs, projects and activities in relation to semiconductors and related technologies.
* The president will establish a subcommittee within NIST on matters related to US leadership in semiconductor technology and innovation, which will develop a national strategy on semiconductor research.
what is the purpose of US Chips Act
The share of modern semiconductor manufacturing capacity located in the US is said to drop from 37% in 1990 to 12% in 2021. This is said to be largely due to large investments and incentives from other countries in chip manufacturing, something that the US government has not done. By enacting the Chips for America Act in Fiscal Year 2021’s National Defense Authorization Act (NDAA), Congress is said to have acknowledged the crucial role that the US semiconductor industry plays in the country’s future.
where is the bill
The funding still needs to be approved by the House of Representatives. The House and Senate reportedly need to come together to pass a bill that is agreeable to both. Currently, the bill is stalled because there is a gap between the House and the Senate. Both houses need to iron out some key differences in their bills. According to a report by Newstack, “The House law includes trade proposals that are not in the Senate bill, while the Senate bill empowers an additional $200 billion to accelerate competition with China. It is not in the House version.” ”
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