Biden to Congress: Pass that Bill to Fund US Chip Manufacturing – CNET [CNET]

President Joe Biden called on Congress to pass the CHIPS Act, a law that would provide chipmakers with $52 billion in subsidies to advance semiconductor manufacturing in the United States, during his State of the Union speech Tuesday.

Biden lauded Intel Chief Executive Pat Gelsinger, who last month announced a $20 billion investment for two new chip fabrication facilities, or fabs, that the company will build just west of Columbus, Ohio. Intel plans to spend $100 billion to build the Ohio “megafab” over the next decade with an eventual total of eight fabs, but the speed of that investment will depend on the US subsidy, Gelsinger has said.

“Intel’s CEO, Pat Gelsinger, who is here tonight, told me they are ready to increase their investment from $20 billion to $100 billion. That would be one of the biggest investments in manufacturing in American history,” Biden said. “And all they’re waiting for is for you to pass this bill…Send it to my desk. I’ll sign it.”

The Senate has passed a bill funding the CHIPS Act, and the House of Representatives has begun work, but the subsidy hasn’t arrived despite some bipartisan support. The funding would help the US compete with government help in Taiwan and South Korea, where leading chipmakers Taiwan Semiconductor Manufacturing Co. and Samsung have the bulk of their operations.

Chipmakers and politicians want to boost chipmaking in the US to help restore the country’s manufacturing prowess. The US share of chip manufacturing slid from 37% in 1990 to 12% today, and processors are crucial not just to mobile phones, internet companies and PCs. They also are essential to automobiles, washing machines and just about anything with a battery or power cord.

With a global chip shortage keeping everything from cars to Sony PlayStations out of consumers’ hands, contributing to inflationary price increases, there are significant tailwinds to help persuade politicians to fund new chip work. Intel’s new fabs in Ohio won’t com online until 2025, though.

Intel’s spending, while mammoth, still trails that of Samsung and TSMC, which in recent years surpassed Intel in chipmaking leadership. Intel’s plan to reclaim its chip technology lead by 2025 hinges on several major challenges, including rapidly advancing its manufacturing and launching a very different business making chips for others, not just its own designs.

Ohio, while far from Intel’s main operations in Silicon Valley, Oregon and Arizona, is notable. Given that Ohio is a key electoral battleground, it’s no surprise Biden opened up the White House for Intel’s announcement and touted it again during Tuesday’s high-profile speech.

Ohio also is close to automakers whose products Intel hopes to help modernize. In February, Intel launched a new automotive division for its Intel Foundry Service to manufacture others’ chips.