TSMC and GlobalFoundries secure $13B in Chips Act funds ahead of Trump's inauguration

[Daniel Sims]

In brief: The US has spent the last two years preparing to award chipmakers billions to help boost the country's domestic semiconductor industry, which has lagged behind nations like Taiwan and South Korea. The US government is negotiating the last of the subsidies as the incoming Trump administration threatens the policy's future.

Reuters and Bloomberg report that TSMC, GlobalFoundries, and another unnamed company have completed agreements to receive billions in Chips Act funds from the US government. The deliveries will likely be the last before the inauguration of President-elect Donald Trump, who is critical of the legislation.

Although the companies haven't yet received the grants and loans, the US Commerce Department recently informed Congress that three companies will imminently receive the money. The amounts reflect prior agreements with TSMC and GlobalFoundries.

The government awarded GlobalFoundries $1.5 billion to construct a new semiconductor fab in New York and help expand the company's Vermont operations. Meanwhile, TSMC secured a $6.6 billion grant and a $5 billion loan to build a fab for 2nm chips in Arizona.

Congress passed the Chips and Science Act in 2022, earmarking $280 billion for chipmakers who agreed to develop manufacturing facilities stateside. The program aims to reduce US dependence on South Korea and Taiwan for the most advanced semiconductors, partly because the latter is under potential threat from China.

Support from the program is contingent on limiting operations in countries considered adversaries like China and Russia. China criticized the Chips Act as a sign of outdated Cold War thinking, while TSMC and Nvidia have cast doubt on the government's aims to eliminate technological interdependence.

Companies such as Micron, Polar Semiconductor, Samsung, BAE Systems, Texas Instruments, and Microchip Technology have negotiated for funds and loans from the legislation. Intel, the largest beneficiary, is set to receive $8.5 billion.

The Chips Act has boosted American electronics investments to historic highs. The country currently produces none of the world's advanced semiconductors but could supply at least 20 percent by the decade's end. However, an analysis earlier this year found that around 40 percent of the funding has suffered delays, some of them indefinite. Intel announced its award in March, but none of the money has reached the company yet.

Furthermore, upon entering the White House, President-elect Donald Trump won't support new payments, having previously expressed his preference for tariffs over subsidies. Republican House Speaker Mike Johnson initially voiced the party's intention to repeal the Chips Act but later recanted.

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TSMC and GlobalFoundries secure $13B in Chips Act funds ahead of Trump's inauguration

 

[MasterAce]

”The country currently produces none of the world's advanced semiconductors”

Aren’t Intel chips made in US?

 

[NotYourITguy]

”The country currently produces none of the world's advanced semiconductors”

Aren’t Intel chips made in US?

Yes and in fact Intel does process development in the USA and then ships equipment to other fabs after they're done with node development for certain processes. Oregon and Arizona are Intel's primary US fabs with Oregon doing mostly R&D and Arizona doing volume. Ireland and Israel are other major Intel fabs that can do CPUs.

 

[Kirby1]

If it's good for the US, Trump will oppose it.

 

[Dimitrios]

Keep crying.

 

[kiwigraeme]

Keep crying.

You mean keep laughing. These things are never as good as promised , and not as bad as predicted .
Seems more harmless than more defense spending
The USA is no longer nimble. Even all the mega Corps I bash who run America and pit people against each other , their purchases and investments , R&D are all a mixed bag. Many don't pan out

Plus one must remember there is a strategic reason for this , ie If Taiwan gets hit by a tsunami etc
Same as rare earth metals.

 

[penn919]

Keep crying.

Let us take a moment to truly appreciate such searing commentary. No doubt counted among America's new voting majority. Rest assured boys; we're in good hands.

 

[unoficialoficial]

The true threat isn't China, even if it were to besiege and capture Taiwan (and TSMC), the critical component of the chip supply chain is ASML in Netherlands. If ASML imposes a blockade, that's where the real issue would arise, as everyone would go bankrupt since no one else has the expertise to build an ASML machine (both Chinese and Russians, highly intelligent nations, have attempted and failed). If ASML decides to sell each ultraviolet machine for 100 or 200 billion dollars, they could do so. The U.S. government would be obligated to provide the funds through taxes to purchase the machines. Alternatively, they could demand that all chips be produced within their national borders, etc. They could enforce any rules they desire. So why don't they? Why don't they act like Americans? Well, because they don't have military minds, they have civilian minds. So, relax a little and don’t see enemies everywhere.

 

[Xelions]

.. ASML in Netherlands. If ASML imposes a blockade, that's where the real issue would arise, as everyone would go bankrupt since no one else has the expertise to build an ASML machine.

Your also forgetting that other critical component - Highly skilled and trained workers! Those ain't lollipop machines. There are a fixed number of these workers and training new people up for the tasks can take many more years.

As for Trump, his a f**king m0r0n! Globalization has taken decades to achieve. To undo it is madness and would take decades - he would be dead and buried before anything significant is accomplished. Killing the chips act policy is the opposite of what he claims to want.

 

[BabaYaga]

Let us take a moment to truly appreciate such searing commentary. No doubt counted among America's new voting majority. Rest assured boys; we're in good hands.

Please don't include the rest of us with him. This is their leader who wants to keep his voting base dumb enough to keep voting for Republicans.
https://www.cnn.com/2024/09/20/politics/department-of-education-shut-down-trump/index.html

It's a cult that votes against their own interests just to show the libs. The two voting classes that Trump got to this election cycle that were kinda unexpected and threw the polls off were white college ages males and their concerned mothers (women over 45). White college males are living in their mom's basement vaping and playing video games. They have no social abilities to meet women and get a job. Their mothers are concerned about that.