Proactive Investors - Intel Corp (NASDAQ:INTC, ETR:INL) is set to be awarded US$8.5 billion in government grants and a further US$11 billion in loans to ramp up semiconductor manufacturing in the US.
This comes as the Biden administration looks to bolster domestic production of chips used in artificial intelligence, with the president set to announce Intel’s awards in Arizona on Wednesday.
Intel has earmarked investment for cutting-edge semiconductor production at large-scale plants in Arizona and Ohio, alongside research and packaging facilities in Oregon and New Mexico, which will be supported by the government funding.
As per US commerce secretary Gina Raimondo, this will help “leading-edge semiconductors made in the United States” keep America "in the driver’s seat of innovation”.
Though Intel has been trumped in terms of revenue by AI chipmaker Nvidia (NASDAQ:NVDA), it operates its own chip factories where others rely on overseas production.
Intel’s expansion projects are expected to create some 20,000 construction jobs, alongside 10,000 roles in chip manufacturing, meanwhile.
“Go drive by the Ohio site,” Intel chief executive Pat Gelsinger commented on a call with reporters.
“There are a whole lot of cranes and concrete job trucks that are building what we believe will become the premier manufacturing location, at scale, particularly for AI chips in America.”
Biden’s subsidies, which Intel said will also include tax credits, come from the 2022 Chips and Science Act, which had set aside US$39 billion for grants.