Intel warns Ohio factory could be delayed because Congress is dragging its feet on funding

Intel warns Ohio factory could be delayed because Congress is dragging its feet on funding


Patrick Gelsinger, Intel CEO, at the WEF in Davos, Switzerland on May 23rd. 2022.

Adam Galica | CNBC

A large chip factory currently in the early stages of being built outside of Columbus, Ohio, could see its scope scaled back or construction delayed depending on what Congress does with the CHIPS Act, Intel said in a statement on Thursday.

The facility was announced in January and would be the most significant expansion of U.S.-based semiconductor manufacturing in years. Intel estimated the plant could cost as much as $100 billion and committed an initial investment of $20 billion.

“We are excited to begin construction on a new leading-edge semiconductor manufacturing plant in Ohio and grateful for the support of Governor DeWine, the state government and all our partners in Ohio. As we said in our January announcement, the scope and pace of our expansion in Ohio will depend heavily on funding from the CHIPS Act,” an Intel spokesperson said in a statement.

“Unfortunately, CHIPS Act funding has moved more slowly than we expected and we still don’t know when it will get done. It is time for Congress to act so we can move forward at the speed and scale we have long envisioned for Ohio and our other projects to help restore U.S. semiconductor manufacturing leadership and build a more resilient semiconductor supply chain,” the statement continued.

Part of Intel’s plan for the facility included subsidies from the U.S. government from the CHIPS Act, which could fund computer chip manufacturing with $52 billion from the U.S. Government to encourage semiconductor manufacturing and research. The bill was passed by the Senate last summer but has yet to be signed into law.

The CHIPS Act has been stalled as lawmakers seek to work out differences between two competing versions of legislation passed in each chamber over roughly the last year. The semiconductor funding is just one part of a broader package that must make its way through the negotiation process.

Intel is still committed to the $20 billion investment it announced earlier this year, a spokesperson told CNBC, but the larger $100 billion investment is uncertain if the CHIPS Act isn’t passed by Congress. Intel CEO Pat Gelsinger is in DC on Thursday to discuss the bill with lawmakers.

Groundbreaking for the Ohio factory is still scheduled for the fall, the spokesperson said.

The Biden administration has hailed the Ohio factory as an example of the president’s efforts to increase manufacturing capacity in the U.S. Gelsinger was a guest of Biden’s at the State of the Union earlier this year.

“If you travel 20 miles east of Columbus, Ohio, you’ll find 1,000 empty acres of land. It won’t look like much, but if you stop and look closely, you’ll see a ‘Field of dreams,’ the ground on which America’s future will be built. This is where Intel, the American company that helped build Silicon Valley, is going to build its $20 billion semiconductor ‘mega site’,” Biden said in the speech.

Most manufacturing of high-end chips currently takes place in Taiwan and South Korea, and U.S. officials say that increasing the amount of semiconductors fabricated on U.S. and European soil is important for national security.

Intel shares were little changed on the news and were down less than 1% during trading on Thursday.

— CNBC’s Lauren Feiner contributed to this story.



Source

Musk, X to face trial in Don Lemon lawsuit alleging breach of contract
Technology

Musk, X to face trial in Don Lemon lawsuit alleging breach of contract

Elon Musk (L) & Don Lemon Reuters (L) | Getty Images (R) Ex-CNN anchor Don Lemon’s lawsuit against tech billionaire Elon Musk and his social network X over the cancellation of their partnership can proceed to trial, a San Francisco judge ruled this week. Musk’s team had tried to get the case moved to a […]

Read More
Bitcoin sets another record above 3,000 as investors jump into risk assets, liquidate shorts
Technology

Bitcoin sets another record above $113,000 as investors jump into risk assets, liquidate shorts

Bitcoin climbed to new all-time high on Thursday, building on its previous record reached just a day earlier, as investors jumped into risk assets and liquidated short positions. The price of the flagship cryptocurrency was last higher by more than 2% at $113,766.74. Earlier, it rose as high as $113,863.18. Over the past 24 hours, […]

Read More
Microsoft Outlook hit with hours-long outage
Technology

Microsoft Outlook hit with hours-long outage

Omar Marques | Lightrocket | Getty Images Microsoft‘s Outlook email service malfunctioned for several hours Wednesday and Thursday, prompting some people to post on social media about the inability to reach their virtual mailboxes. The issue began at 6:20 p.m. Eastern time on Wednesday, according to a dashboard the software company maintains. It affected Outlook.com as well […]

Read More