The United States has announced that the federal government will provide up to $8.5 billion in subsidies to Intel. Intel will use the money to build new fabs and modernize existing chip factories in various states.

Intel will invest $100 billion in US chip manufacturing over the next five years. Govt A maximum of $8.5 billion will be directly contributed to this. Along with investments and grants, Intel is introducing two new leading edge Builds fabs in Chandler, Arizona, where existing fabs are being modernized. This is where Intel wants to build chips based on the 18A process and where the first 18A product, the Clearwater Forest Xeon CPUs, should come from.

In New Albany, Ohio, two are required Leading logicFabs are being built and two fabs in Rio Rancho, New Mexico are being converted into advanced packaging factories. For high NA EUV equipment, a development center is to be established in Hillsboro, Oregon.

Of this money, $50 million is intended to train Intel employees who work and build factories. The government says the subsidy and Intel’s investments will create 30,000 jobs, 20,000 of which will be for the construction of the fabs. In addition to the $8.5 billion in direct grants, Intel can borrow up to $11 billion through the Chip Act.

These grants fall under the Chips and Science Act and are intended to increase chip production in the United States. This is the largest grant under the Act till date. The CHIPS Act was signed into law by US President Joe Biden in 2022 and includes a $52.7 billion subsidy. The present agreement is not yet binding and a dependent Due diligence– Research.