The US government under the Biden administration has made a commitment of $162 million, to Microchip Technology Inc. This funding is part of their efforts to strengthen the production of computer chips within the country. It’s the investment made under a law implemented in 2022, which aims to revive semiconductor manufacturing in America.
As per the announcement by the US Department of Commerce, this financial assistance package includes $90 million for upgrading a facility located in Colorado Springs, Colorado, and $72 million for expanding a factory in Gresham, Oregon.
By receiving this support, Microchip Technology will be able to triple its production capacity and reduce its dependence on factories. A significant portion of these funds will be allocated toward manufacturing microcontrollers – components used in applications, automobiles, home appliances, and medical devices. The government expects that these investments will create around 700 jobs related to construction and manufacturing over the decade.
Lael Brainard, who serves as the Director of the US National Economic Council, highlighted that this funding would play a role in managing inflation. Brainard emphasized that semiconductors are vital for goods to our economy, and the increased domestic production could have helped address supply issues that caused price increases for various products like cars and washing machines during the post-COVID-19 recovery period in 2021.
The CHIPS and Science Act, which was signed into law by President Biden in August 2022, has set aside more than $52 billion to boost the growth and production of semiconductors within the United States. The first grants were announced, including a $35 million agreement with BAE Systems Inc. This investment will be used to expand a factory located in New Hampshire that manufactures chips for aircraft like the F15 and F35 jets.
Given the interest from over 570 companies in participating in the CHIPS Act program, Gina Raimondo, the US Secretary of Commerce, mentioned that the administration plans to award twelve grants this year.