US Government Could Delay $8.5 Billion CHIPS Act Funding for Intel

[Nomad76]

The $8.5 billion in CHIPS Act assistance intended for Intel from the US government is expected to be delayed due to the company's ongoing financial struggles. According to a Bloomberg report, the Department of Commerce rejected the initial allocation request, requiring Intel to meet specific objectives and complete a comprehensive due diligence process before the funds are released.

Intel has committed to remaining engaged in discussions despite the additional requirements, though it encountered regulatory and timing challenges. The terms of the funding include $8.5 billion in direct assistance to Intel, along with $11 billion in low-cost credit, and a 25 percent tax credit worth up to $100 billion for Intel's investments in Arizona, New Mexico, Ohio, and Oregon.

Intel said in a statement that "we are making significant progress across our US projects in Arizona, New Mexico, Ohio and Oregon, and look forward to finalizing our funding agreement soon."

"We've been working hard to address the issues," CEO Pat Gelsinger told investors at a conference last week. "Like everybody in the industry, we realize we have to operate efficiently with nimbleness, with urgency."

Enacted by Congress in July 2022, the CHIPS and Science Act was designed to strengthen the US domestic semiconductor industry, with funding allocated for semiconductor R&D, domestic production, and specialized tooling equipment.

"We recognize that we are operating in one of the most cyclical, intensely competitive industries in the entire world, and that dynamics are going to shift," Mike Schmidt, who runs the Commerce Department's chips office, said in an early August interview when asked about risks to the overall program. "We'll have to be nimble in how we respond to that."

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[Daven]

Spin off the fabs already!

 

[64K]

Makes sense. The question to answer is Intel competent to manage the billions of dollars sensibly. imo Intel needs to climb out of the hole that they dug and jumped into first.

 

[Assimilator]

Spin off the fabs already!

How will that fix the underlying problems?

 

[Neo_Morpheus]

Ahh, sweet karma is keeping the beat down on poor intel up.

Love it!

ARM, RISC V and even POWER needs to be ready to step up to take advantage of this “intel tragedy”

 

[P4-630]

Ahh, sweet karma is keeping the beat down on poor intel up.

Love it!

ARM, RISC V and even POWER needs to be ready to step up to take advantage of this “intel tragedy”

Nice CPU bottleneck you got there in your system specs..

 

[tfp]

How will that fix the underlying problems?

It won't but that makes Intel the same as AMD so it's a benefit

 

[kondamin]

Its the chips act that made intel overextend it self in the first place.
bunch of vultures really want an other corpse to pick clean

 

[tfp]

And people are pretending that Intel has already gotten the money but it seems that they have not

 

[phanbuey]

It won't but that makes Intel the same as AMD so it's a benefit

That's not a benefit. That's a huge liability.

All AMD does is design chips; designs that are then shipped off 100 miles next to a competing geopolitical superpower to fabricate...

In a world where Semiconductors and AI dominance is increasingly important...

 

[sepheronx]

Give me the money, I'll build a FAB

 

[Kapone33]

That's not a benefit. That's a huge liability.

All AMD does is design chips; designs that are then shipped off 100 miles next to a competing geopolitical superpower to fabricate...

In a world where Semiconductors and AI dominance is increasingly important...

I am actually shocked that the US has not inspired AMD to create a Fab in the US. I guess all of the negative narrative about AMD may have made them gun shy to pull the trigger on that. Maybe TSMC pricing will get to a level where that would seem plausible.

 

[Caring1]

I am actually shocked that the US has not inspired AMD to create a Fab in the US. I guess all of the negative narrative about AMD may have made them gun shy to pull the trigger on that. Maybe TSMC pricing will get to a level where that would seem plausible.

Or maybe the U.S. government is on Intel's payroll too.

 

[tfp]

I am actually shocked that the US has not inspired AMD to create a Fab in the US. I guess all of the negative narrative about AMD may have made them gun shy to pull the trigger on that. Maybe TSMC pricing will get to a level where that would seem plausible.

AMD to create a Fab, don't you mean Global Foundries? AMD had Fabs but split the company because the Fabs got behind and the investment was to much. Having them start over from zero for this kind of investment does not make sense.

The US isn't just investing to Intel and TSMC, their is money going to Intel, TSMC, Samsung, Micron, Global Foundries, Microchip Technology, Polar Semiconductor, and BAE Systems. They all have different levels of Fab tech.

 

[ThomasK]

That's not a benefit. That's a huge liability.

Is it? Go tell that to NVIDIA, which has the AI marked on its hands and is laughing all the way to the bank, without manufacturing anything.

 

[yfn_ratchet]

That's not a benefit. That's a huge liability.

All AMD does is design chips; designs that are then shipped off 100 miles next to a competing geopolitical superpower to fabricate...

In a world where Semiconductors and AI dominance is increasingly important...

TSMC is already heavily spooked by this and it's the primary reason that they're actively working to get as many fabs on western soil as possible in case of SHTF back home. By all means there will probably be a backup HQ in NY or Berlin if it gets bad enough.

I was pretty happy to hear that things were going well for the Arizona branch a little while ago.

 

[A Computer Guy]

Or maybe the U.S. government is on Intel's payroll too.

Or maybe because AMD has no relevant fabs anymore and it would be pointless?

 

[bonehead123]

Well, with the way our gov't hands out/prints/gives away money (to places/people/companies that don't do shit for us), $8.5B is a mere drop in the proverbial bucket, yes ?

Here's a thought: Make the CHIPS act funding 100% contingent on a company making an equal amount of costs/salary/bonus/expense account reductions, and progress towards for all it's execs & mgmt, as well as mandatory progress towards improving energy efficiency & accomplishing strict green mfgring....WITHOUT LAYING OFF A SINGLE, LOWER-LEVEL EMPLOYEE !

 

[tfp]

Well, with the way our gov't hands out/prints/gives away money (to places/people/companies that don't do shit for us), $8.5B is a mere drop in the proverbial bucket, yes ?

Here's a thought: Make the CHIPS act funding 100% contingent on a company making an equal amount of costs/salary/bonus/expense account reductions, and progress towards for all it's execs & mgmt, as well as mandatory progress towards improving energy efficiency & accomplishing strict green mfgring....WITHOUT LAYING OFF A SINGLE, LOWER-LEVEL EMPLOYEE !

This requirement doesn't make sense outside of maybe the manufacturing division. A lot of this money will just to building the buildings and starting to equip them. This has nothing to do with the rest of the company that may need layoffs. If Intel sacks 15% of marketing, while not great for those people, what does that have to do with the Fabs?

 

[Wirko]

Make the CHIPS act funding 100% contingent on a company making an equal amount of costs/salary/bonus/expense account reductions,

Or just lend the money instead of giving it away.
Or buy shares in an IPO. If anyone says this is nationalisation - yes it is but only if the company wants that.

 

[Steevo]

Its the chips act that made intel overextend it self in the first place.
bunch of vultures really want an other corpse to pick clean

I’m not sure what you mean.

Intel put themselves in this position by being complacent with small incremental changes and focusing on profits in years past instead of future planning. Now they want daddy B to give them money to help them instead of selling stocks they bought back

 

[Uns1gn3d_C0d3]

Give me the money, I'll build a FAB...

...ulous mansion in a country that doesn't extradite?

 

[Kapone33]

AMD to create a Fab, don't you mean Global Foundries? AMD had Fabs but split the company because the Fabs got behind and the investment was to much. Having them start over from zero for this kind of investment does not make sense.

The US isn't just investing to Intel and TSMC, their is money going to Intel, TSMC, Samsung, Micron, Global Foundries, Microchip Technology, Polar Semiconductor, and BAE Systems. They all have different levels of Fab tech.

I know about Global Foundries

This requirement doesn't make sense outside of maybe the manufacturing division. A lot of this money will just to building the buildings and starting to equip them. This has nothing to do with the rest of the company that may need layoffs. If Intel sacks 15% of marketing, while not great for those people, what does that have to do with the Fabs?

Actually what Micron has done in Upstate New York is an example of how the Chips act should be applied.

Micron | Empire State Development

esd.ny.gov

What is not in this is that Micron are helping fund K-12 Public schools to source their employees for the next 25 years.

 

[A&P211]

Give me the money, I'll build a FAB

No, give me the money, I will talk about building a FAB.

 

[Ravenas]

One of the terms should be that they aren't going fabless this cycle with TSMC. Waste of tax pay money if they allow Intel to operate like this. Give the money to Texas Instruments.