News US govt's CHIPS Act gives Intel $8.5 billion in funding and a 25% tax credit on $100 billion in investments

[Admin]

Intel and the U.S. Commerce department have agreed on preliminary terms to provide the chipmaker with $8.5 in funding, as well as $11 billion in loans and a separate tax credit to bolster US production on leading edge nodes like Intel 18A.

US govt's CHIPS Act gives Intel $8.5 billion in funding and a 25% tax credit on $100 billion in investments : Read more

 

[watzupken]

This is not unexpected. Intel is a US company and probably the biggest fab owner at the same time. It makes little sense that the US government will fund any other foreign fabs more.

In my opinion, all these talk about creating more fab is not sustainable. Again, fabs don't magically create chips out of thin air. You need resources to produce chips, including things like the right workforce, having access to plenty and stable electric and water supply. Throwing money at building fabs and buying equipment is not sufficient. I may be wrong, but let's see what happens when all these planned fabs are ready for operation.

 

[rluker5]

This is good news for US chip manufacturing. I had serious doubts that the CHIPS Act would deliver in an effective manner, but it has.

And before the AI manufacturing boom has passed as well. Even after AI demand wanes, there are still lots of chips to be made on new nodes.

 

[PEnns]

This is not unexpected. Intel is a US company and probably the biggest fab owner at the same time. It makes little sense that the US government will fund any other foreign fabs more.

In my opinion, all these talk about creating more fab is not sustainable. Again, fabs don't magically create chips out of thin air. You need resources to produce chips, including things like the right workforce, having access to plenty and stable electric and water supply. Throwing money at building fabs and buying equipment is not sufficient. I may be wrong, but let's see what happens when all these planned fabs are ready for operation.

There are employees whose sole job is to look at a project like this and study all the factors you mentioned. They call them analysts, project managers, etc who create feasibility studies to look at every aspect and scrutinize all possible constraints. before they grab a shovel and start digging a simple trench.

I doubt there is a single entity worth its salt that would look at the map, choose a random spot and say "this is where we are building a billion+ $ factory. Here's the money and start building!"

 

[ezst036]

The unbroken streak of success of lobbyists continues.

Lobbyists - 9
Everyone else - 0

 

[kealii123]

The unbroken streak of success of lobbyists continues.

Lobbyists - 9
Everyone else - 0

Ya, how can I get some of that sweet government honey?

As usual, subsidies for the billionaires, inflation for the rest of us.

 

[ekio]

Tax payers are funding Intel now…
Are we going to get shares for this investment or free cpu at least?
Of course not, the richest get richer, the rest get f**ked.

 

[thisisaname]

They have promised much but hoe much has been paid out yet?

 

[rluker5]

Tax payers are funding Intel now…
Are we going to get shares for this investment or free cpu at least?
Of course not, the richest get richer, the rest get f**ked.

Also AMD and Nvidia (indirectly, but still significantly), although those are taxpayers from Taiwan and South Korea. All for pretty much the same reasons.
Intel is such a large recipient because they are doing most of the leading edge semiconductor manufacturing in a country promoting that industry within their borders.
If AMD or Nvidia were building high NA EUV fabs in the US they would receive CHIPS funds as well.

 

[RolandOlifant]

outstanding

 

[kjfatl]

This is not unexpected. Intel is a US company and probably the biggest fab owner at the same time. It makes little sense that the US government will fund any other foreign fabs more.

In my opinion, all these talk about creating more fab is not sustainable. Again, fabs don't magically create chips out of thin air. You need resources to produce chips, including things like the right workforce, having access to plenty and stable electric and water supply. Throwing money at building fabs and buying equipment is not sufficient. I may be wrong, but let's see what happens when all these planned fabs are ready for operation.

It's called the boom-bust cycle. There are two or three ways to survive this as a business. One is to so dominate the market that on one else can survive without government intervention. TSMC fits this category while continually accepting Taiwanese government subsidies.. One is to be highly profitable and immediately reinvest, knowing that there will be periods of overcapacity. Intel used to do this, but gave up on reinvestment for a few years of false profit. One is to outsource your production and hope that supplier prices don't go up to the point you are unprofitable. AMD and NVIDIA have taken this approach.
Intel is at the point where they still have the process knowledge to regain their position as the dominant supplier of expensive high-end digital electronics. What they lack is cash. TSMC and Samsung will likely remain the leaders of midrange to high end semiconductors. China will be happy with the entire bottom 1/2 of the market.
I'm leaving out a lot here like memory suppliers, analog suppliers like TI, LEDs, power switching electronics. etc.

 

[thisisaname]

Seeing a few of <someone> awarded funds but not seen any where the money is paid out or is that just not being reported?

 

[jkflipflop98]

Tax payers are funding Intel now…
Are we going to get shares for this investment or free cpu at least?
Of course not, the richest get richer, the rest get f**ked.

This is a pretty short-sighted view of things. Once these facilities come online, they create 10's of thousands of high-paying jobs that benefit not just a huge area local to the facility, but also the United States as a whole. Try thinking a little further out than "Me! Me! Me!"

 

[CmdrShepard]

This is a pretty short-sighted view of things.

I disagree.

Once these facilities come online, they create 10's of thousands of high-paying jobs that benefit not just a huge area local to the facility, but also the United States as a whole.

That remains to be seen. Arizona is an "at-will" employment state, which means that they can set salaries to whatever point they want and you can take it or leave it.

Intel got direct funding which they don't have to return ($8bn), sweet loan with low interest rate ($11bn), and a 25% tax cut (up to $100bn, which they also won't be returning).

But yes, sometimes after 2027 (not counting potential delays in construction) someone will maybe be able to get a job out of all that taxpayer money. Probably some immigrants who will agree to work for less.

I am sure Intel has chosen Arizona because it has plenty of water which is needed for chip fabs, and not because of "at-will" employment law. Oh wait...

Try thinking a little further out than "Me! Me! Me!"

Oh but he is.

He is thinking about what he will be able to leave to his children (if he has any).

So far it seems he will only be able to leave them a "right" to work as slaves in some factory or warehouse.

Next up in the feudalist playbook (because late stage capitalism is reverting to feudalism and fast) -- company scrip.