Intel Corporation stands poised to receive an unprecedented boost from the U.S. government, marking the largest investment under the CHIPS Act, a significant stride in bolstering domestic semiconductor production. A tentative agreement struck with the Department of Commerce outlines Intel’s potential windfall, with up to $8.5 billion in direct funding earmarked to fortify the chipmaker’s U.S. manufacturing facilities. These funds will fuel the expansion of Intel’s semiconductor production capabilities, specifically targeting fabs geared towards advanced chips crucial for artificial intelligence and other cutting-edge applications.

This substantial public investment is slated to underpin Intel’s ambitious ventures across four states, including the construction of two new advanced logic chip plants and the modernization of an existing facility in Chandler, Arizona, alongside the establishment of two additional fabs in New Albany, Ohio. Moreover, Intel aims to spearhead the modernization efforts of two existing plants in Rio Rancho, New Mexico, while augmenting capacity in Hillsboro, Oregon. The injection of $8.5 billion in government funding will complement Intel’s staggering $100 billion commitment to U.S. manufacturing over the ensuing five years. Furthermore, the agreement allows Intel to access an additional $11 billion through borrowing from the U.S. government if deemed necessary.

The CHIPS and Science Act, endorsed by the Biden administration in 2022, seeks to bolster domestic semiconductor research and production, aiming to reduce American companies’ dependency on Chinese suppliers. This latest tranche of funding marks the fourth installment under the CHIPS Act and represents the most substantial investment thus far. When coupled with Intel’s own financial resources, this collaboration represents one of the most significant injections of capital into U.S. semiconductor manufacturing. Earlier in February, the government pledged $1.5 billion in CHIPS Act funding to GlobalFoundries, a subsidiary of AMD, to support the construction of new fabs.

Intel’s expansive projects across multiple regions are expected to generate approximately 20,000 construction jobs and 10,000 manufacturing positions. To ensure local communities benefit from these initiatives, the government will allocate $50 million towards training and skill development for the workforce. However, these terms are contingent upon the preliminary agreement, subject to potential amendments by the Commerce Department following due diligence on proposed projects and any subsequent renegotiations.

Source: Engadget