Intel postpones groundbreaking ceremony, warns of delays at Ohio plant as CHIPS Act stalls

midian182

Posts: 8,023   +88
Staff member
What just happened? Intel says it will delay the groundbreaking ceremony of its Ohio semiconductor factory and has warned of potential delays due to Congress dragging its feet over the CHIPS Act. The legislation will provide, among other things, $52 billion in funding for increasing domestic semiconductor production and research & development.

In January, Intel announced plans to build a $20 billion chip manufacturing complex in New Albany, on the outskirts of Columbus, Ohio, as part of its IDM 2.0 strategy. The facility, predicted to directly employ 3,000 people, is supposed to begin construction later this year and be fully operational by 2025.

Intel said that spending on the Ohio site could reach $100 billion over the next ten years, but the company has warned that the "scope and pace" of this expansion is dependent on the CHIPS Act. While a version of the standalone bill was passed last year, the funding still isn't signed into law as House and Senate negotiators continue to work on resolving disputes.

"Unfortunately, CHIPS Act funding has moved more slowly than we expected and we still don't know when it will get done," said Intel spokesman Will Moss, who called on Congress to act so Intel "can move forward at the speed and scale we have long envisioned for Ohio" and other US projects.

The groundbreaking ceremony for the Ohio factory had been scheduled for next month but will now be postponed due partly to the "uncertainty" around the bill. Moss said that Intel is still committed to the $20 billion investment and remains excited to begin construction on the site.

GlobalFoundries, which is expanding a manufacturing site in Malta, New York, gave a similar warning about the CHIPS Act delay slowing its plans. "The CHIPS Act makes the US semiconductor industry more competitive globally. For GlobalFoundries, the passing of CHIPS funding would affect the rate and pace at which we invest in expanding our U.S. manufacturing capacity," a spokesperson said.

Intel is also building new chip fabs in Arizona; it has invested $7 billion in a new manufacturing center in Malaysia; there are plans to invest $3.5 billion in its New Mexico operations; and its $7 billion Fab 34 production facility in Ireland got its first equipment earlier this year. Additionally, the company is receiving 6.8 billion euros ($7.15 billion) in subsidies, around 40% of the total cost, to build a state-of-the-art campus in Germany (above).

In other Intel news, the firm has just demanded $625 million in interest from the EU after its $1.2 billion antitrust fine was overturned in January.

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hahahanoobs

Posts: 4,526   +2,494
Companies are always looking for government handouts to fund their next project. How about you pay taxes and don't give shareholders dividends for a few years? You leeches.
Advanced nodes and a once again dominate American chipmaker to combat TSMC are not "projects". It's business, security and American jobs.

You should read up on the deal.
 

yRaz

Posts: 4,524   +5,383
Companies are always looking for government handouts to fund their next project. How about you pay taxes and don't give shareholders dividends for a few years? You leeches.
Considering the situation going on with Taiwan, TSMC and the chip shortage, Government spending to increase domestic chip production is a matter of national security at this point. 99% of the time I agree that government spending is out of control but $52 billion is drops in a bucket of the $7 trillion it spends a year. Not to mention that it is more an investment than a handout. If we become a leader in chip manufacturing, that creates revenue that can be taxed and spent on far more frivolous government projects.

Frankly, spending on domestic chip manufacturing will do more for national security than most of our military spending.
 

defaultluser

Posts: 435   +348
Companies are always looking for government handouts to fund their next project. How about you pay taxes and don't give shareholders dividends for a few years? You leeches.


Because, outside of boom time, its often risky to build a new fab. Which is why

1. it took nearly a year for the biggest manufacturers to take the plunge and promise new fabs in 2020 / supply plants

2. by the time most of those are up-and-running, we will be back to our usual boom-bust tech cycle.

But folks like you don't care, as long as perpetual money printers like Apple and Google continue the show?
 

wiyosaya

Posts: 7,827   +6,803
Because, outside of boom time, its often risky to build a new fab. Which is why

1. it took nearly a year for the biggest manufacturers to take the plunge and promise new fabs in 2020 / supply plants

2. by the time most of those are up-and-running, we will be back to our usual boom-bust tech cycle.
Risk is part of life and business. IMO, if any company is not willing to accept the risk, perhaps they should reconsider why they are in business in the first place.
But folks like you don't care, as long as perpetual money printers like Apple and Google continue the show?
Surely, Apple and Google are great companies to cite - especially, IMO, since they are a primary driver of the problem in the first place. Apple, especially, had a choice when they sent production outside the country. According to this and other sources, Apple had, in 2019 already, nearly $250 Billion in the bank. Just when is enough enough?
 

Dsirius

Posts: 142   +249
Intel is crying for more Government funds, while swimming in hundreds of billion $ profit. I remember that USA claim that China is funding Huawei and even made a blacklist with chinese firms which suppose are anticompetitive. This is the pinnacle of greed, hypocrisy and anti-competitiveness.
 

Irata

Posts: 2,165   +3,745
Risk is part of life and business. IMO, if any company is not willing to accept the risk, perhaps they should reconsider why they are in business in the first place.

Surely, Apple and Google are great companies to cite - especially, IMO, since they are a primary driver of the problem in the first place. Apple, especially, had a choice when they sent production outside the country. According to this and other sources, Apple had, in 2019 already, nearly $250 Billion in the bank. Just when is enough enough?
I'd give several up votes if I could.
 

Uncle Al

Posts: 8,930   +7,895
Bottom line .... the government needs to get out of the business of funding private and public companies. If the company can't pay it's own way it has no reason to be or stay in business. The only businesses the government should "help" via low interest loans, etc. are the start-up's that could grow to become bigger companies. Asking Americans to subsidise any business venture without a direct, measureable return is wrong. If you're going to subsidise then force these companies to issue shares of stock to every American .... yeah, sureeeee .....
 

nodfor

Posts: 269   +471
There are two ways to provide incentives for tech companies to build fabs in the US

1) Subsidies
2) Import taxes on chips/tech products

With the spending power the US consumer has, 2 could be a solid option but not for this administration, it just loves big tech (and big tech loves it back)

 

eforce

Posts: 1,011   +1,458
Socialism has made domestic manufacturing too expensive for the private sector to do without government subsidy.