The CEO of Intel is disappointed with the funding under the U.S. CHIPS Act. Since its enactment, the company has invested $30 billion in U.S. factories but has received no direct government funding.
Intel's CEO Pat Gelsinger shared this in an interview with Yahoo! Finance. The slow funding process is hindering the company and prompting them to seek alternative investments.
“We view the CHIPS Act as a significant initiative into which we’ve invested a lot of energy. As we mentioned during the earnings report, we are disappointed with the timeline: more than two years have passed since the CHIPS Act was enacted, and during this time we have invested $30 billion in U.S. manufacturing and received $0 in CHIPS grants. This is taking too long; we need to wrap this up.”
Since the CHIPS and Science Act came into effect, Intel has started assembling chips at its factory in New Mexico and has begun constructing new plants in Arizona and Ohio. Due to lower demand for processors and the very slow launch of Intel Foundry as a contract manufacturer, Intel has had to delay the opening of its Ohio campus for a couple of years, but the company has invested significantly in its facilities in the U.S. It is worth mentioning that Intel received $3 billion under the Secure Enclave program to fund military chip production.
“However, we are closely collaborating with the CHIPS office and interacting constructively with them to complete what we started. But I also want to point out that [CHIPS includes] subsidies and tax [credits] — the share of taxes is about three times greater than the share of subsidies in the CHIPS Act. That being said, we see this continuing [as] part of the current tax legislation, so we will still see that benefit,” Gelsinger added.
Despite Intel expecting to receive about $8.5 billion in direct investments, up to $11 billion in loans, and a 25% tax credit, the company has yet to receive this $8.5 billion. As a result, Intel had to ensure that it could build its factories even without direct U.S. government funding. Intel has launched a semiconductor co-investment program (SCIP), which means that in the case of its Fab 52 and Fab 62 in Arizona, the manufacturing facilities will be managed by Intel, but 49% will be owned by co-investors Brookfield Asset Management.
Pat Gelsinger is confident that Intel will be able to complete the projects it has started with or without CHIPS funding. “But we are looking forward to finalizing what we started with CHIPS, the most important industrial policy law in the U.S., in which we take great pride in participating.”
Source: Tom's Hardware
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