The U.S. Department of Commerce announced today that it has given $7.865 billion to chip giant Intel under the U.S. CHIPS and Science Act. This is a federal law that President Joe Biden signed into law in 2022 to encourage more semiconductors to be made in the U.S.
The number is much lower than the highest amount that could be given. In March, the White House said that it had made a deal with the Department of Commerce to give Intel a grant of “up to” $8.5 billion.
All of this is happening at the same time that Intel is switching to a business plan called “foundry,” in which it makes chips for other companies under contract. Intel has had to increase its capacity to keep up with this. In 2021, the company announced that it would be investing $20 billion in two new fabrication (or “fabs”) facilities at its Arizona Ocotillo site. This was done at the same time that the company officially launched its new foundry business. This group was given a new name by Intel in February: Intel Foundry. In September, Intel made the group a legal subsidiary.
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Intel is also working on a number of big construction projects around the world at the same time. However, the company recently said that it would be delaying two of these projects by two years, in Germany and Poland. On the other hand, the company is spending up to $28 billion building two new plants in Ohio. These plants were supposed to start making things in 2025, but Intel recently said they would be delayed because of “market challenges.”
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