November 29, 2024 /SemiMedia/ — The U.S. Department of Commerce has confirmed a $7.86 billion government subsidy for Intel, under the CHIPS Act, slightly less than the $8.5 billion initially announced in March. This subsidy, the largest direct funding under the plan, will support Intel’s nearly $90 billion manufacturing projects in Arizona, New Mexico, Ohio, and Oregon.

Intel will be eligible to receive funds as it meets specific milestones in these states. A senior official confirmed that Intel could qualify for at least $1 billion this year based on its progress. However, its Ohio facility, which has been delayed for several years, currently does not qualify for federal support, despite already receiving $2 billion from the state.

Commerce Secretary Gina Raimondo highlighted that the deal will enable chips “designed in the U.S. to be manufactured and packaged in the U.S. by American workers for the first time,” marking a significant achievement for the 2022 CHIPS Act. This bipartisan initiative includes $39 billion in grants, $75 billion in loans, and a 25% tax credit to revive U.S. semiconductor manufacturing.

Raimondo pointed out that Intel’s contract is the sixth finalized under the CHIPS Act, with more expected soon. These contracts include safeguards for taxpayers, such as restrictions on stock buybacks and provisions for sharing any significant excess profits.

Intel CEO Pat Gelsinger emphasized that this support reflects strong bipartisan backing for restoring U.S. leadership in technology and manufacturing, positioning the investment as crucial for long-term economic growth and national security.