Big Picture
The Biden administration is planning to provide financial support (subsidies) amounting to billions of dollars to major semiconductor companies like Intel and Taiwan Semiconductor Manufacturing Co (TSMC).
The purpose of these subsidies is to help these companies build new semiconductor manufacturing facilities in the United States.
Why Semiconductors are Important
The focus is on manufacturing advanced semiconductors.
These semiconductors are crucial components for various technologies, including smartphones, artificial intelligence, and weapons systems.
Expected Announcements
The Biden administration is likely to make announcements about these subsidies, and some of these announcements may come before President Joe Biden’s State of the Union address on March 7.
Companies Involved
Intel has projects in several states (Arizona, Ohio, New Mexico, and Oregon) with a total cost exceeding $43.5 billion.
TSMC is also a likely recipient, investing $40 billion in two plants near Phoenix.
Samsung Electronics has a $17.3 billion project in Texas.
Other companies like Micron Technology, Texas Instruments, and GlobalFoundries are also in contention for these subsidies.
Previous Developments
In the previous year, the U.S. Commerce Secretary announced an award of over $35 million to a BAE Systems facility in Hampshire. This is part of a larger $39 billion “Chips for America” subsidy program approved by the U.S. Congress in 2022.
Responses and Contacts
The U.S. Department of Commerce, Intel, and TSMC did not immediately respond to Reuters’ request for comment.
Background
The subsidies are part of a broader initiative to boost semiconductor manufacturing in the United States, which is seen as strategically important for the country’s technological leadership and national security.