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

A big chip manufacturing unit at the moment within the early levels of being constructed exterior of Columbus, Ohio, might see its scope scaled again or building delayed relying on what Congress does with the CHIPS Act, Intel mentioned in a press release on Thursday.

The ability was introduced in January and could be essentially the most vital growth of U.S.-based semiconductor manufacturing in years. Intel estimated the plant might price as a lot as $100 billion and dedicated an preliminary funding of $20 billion.

“We’re excited to start building on a brand new modern semiconductor manufacturing plant in Ohio and grateful for the assist of Governor DeWine, the state authorities and all our companions in Ohio. As we mentioned in our January announcement, the scope and tempo of our growth in Ohio will rely closely on funding from the CHIPS Act,” an Intel spokesperson mentioned in a press release.

“Sadly, CHIPS Act funding has moved extra slowly than we anticipated and we nonetheless do not know when it’s going to get achieved. It’s time for Congress to behave so we are able to transfer ahead on the velocity and scale we’ve lengthy envisioned for Ohio and our different initiatives to assist restore U.S. semiconductor manufacturing management and construct a extra resilient semiconductor provide chain,” the assertion continued.

A part of Intel’s plan for the power included subsidies from the U.S. authorities from the CHIPS Act, which might fund pc chip manufacturing with $52 billion from the U.S. Authorities to encourage semiconductor manufacturing and analysis. The invoice was handed by the Senate final summer time however has but to be signed into regulation.

The CHIPS Act has been stalled as lawmakers search to work out variations between two competing variations of laws handed in every chamber over roughly the final 12 months. The semiconductor funding is only one a part of a broader package deal that should make its method by the negotiation course of.

The Biden administration has hailed the Ohio manufacturing unit for example of the president’s efforts to extend manufacturing capability within the U.S. Intel CEO Pat Gelsinger was a visitor of Biden’s on the State of the Union earlier this 12 months.

“Should you journey 20 miles east of Columbus, Ohio, you may discover 1,000 empty acres of land. It will not seem like a lot, however when you cease and look carefully, you may see a ‘Subject of goals,’ the bottom on which America’s future will likely be constructed. That is the place Intel, the American firm that helped construct Silicon Valley, goes to construct its $20 billion semiconductor ‘mega website’,” Biden mentioned within the speech.

Most manufacturing of high-end chips at the moment takes place in Taiwan and South Korea, and U.S. officers say that growing the quantity of semiconductors fabricated on U.S. and European soil is essential for nationwide safety.

Intel shares have been little modified on the information and have been down lower than 1% throughout buying and selling on Thursday.

— CNBC’s Lauren Feiner contributed to this story.