Joe Biden Administration Announces $162 Million to Expand Computer Chip Factories in US

The administration of the President of the United States Joe Biden is allocating $162 million in funding to Microchip Technology as part of support for the homegrown production of computer chips.

Joe Biden Administration Announces $162 Million to Expand Computer Chip Factories in US

This financial support will be provided within the framework of the law of 2022, adopted by the American authorities to promote the development of the local microcircuits manufacturing industry. This sphere of activity currently needs external support.

The financing for Microchip Technology includes $90 million for the modernization of the plant in Colorado Springs, Colorado, and $72 million for the expansion of production facilities in Gresham, Oregon. The relevant information was released by the United States Department of Commerce.

The financing will provide Microchip Technology with the opportunity to triple the volume of domestic production. Also, as a result of government support, the company will reduce the level of dependence on foreign factories.

Most of the funding will be directed to the production of microcontrollers, which are used in the military industry, in cars, household appliances, and medical devices.

Government officials expect that after receiving the investment, Microchip Technology will create 700 jobs in construction and manufacturing over the next decade.

Lael Brainard, director of the White House National Economic Council, said that this funding will help contain the inflationary process. She also noted that semiconductors are the raw materials for the production of many goods that are critical to the economic system of the United States. Separately, Lael Brainard said that an increase in the volume of making chips in the United States would improve the situation with the supply process, violations which caused the cost of products in many categories to rise, including cars and washing machines. This problem has become more relevant as the coronavirus pandemic has ended.

After the end of the difficult sanitary and epidemiological situation, the inflation rate in the United States decreased. At the same time, the financial burden on the population continued due to the rising cost of goods and services, which became a negative factor affecting public confidence in Joe Biden.

In August 2022, the President of the United States signed the bipartisan Chips and Science Act. This law provides for the provision of government funding for more than $52 billion to stimulate the development and production of semiconductors in the US.

Last December, the Commerce Department announced the first grants within the framework of state economic support. An agreement has been reached to provide $35 million to BAE Systems, which plans to expand a plant in New Hampshire that manufactures chips for military aircraft, including the F-15 and F-35.

Government officials expect that new decisions on financing of making microcircuits will be made this year.

Commerce Secretary Gina M. Raimondo said the decision to allocate funding to Microchip Technology is an important step in efforts to strengthen the supply chain of semiconductors, which are used in many products.

As we have reported earlier, TSMC and Arizona Authorities Discuss Advanced Chip Packaging Investment.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.