Chipmakers Seek More Than $70 Billion in Federal Subsidies

Gina Raimondo, the commerce secretary, said new investments would put the U.S. on track to produce roughly 20% of the world’s most advanced logic chips by the end of the decade.
Chipmakers Seek More Than  Billion in Federal Subsidies

Companies that produce the most advanced semiconductors have requested more than $70 billion in federal subsidies, roughly twice the amount of funding that is available, Commerce Secretary Gina Raimondo said on Monday.

In an effort to revitalize domestic manufacturing of semiconductors, the federal government is distributing $39 billion in subsidies as an incentive for companies to produce more of the tiny chips that power everything from smartphones to cars and fighter jets. The funding is meant to strengthen the U.S. supply chain and reduce the country’s reliance on foreign sources of chips. Currently, just 12 percent of chips are made in the United States.

The grants have so far proven popular among companies. In a speech on Monday at the Center for Strategic and International Studies, Ms. Raimondo said her department had received more than 600 statements of interest.

Federal officials have had to be “tough with companies,” Ms. Raimondo said, adding that she has pushed company executives to “do more for less.” She added that the level of interest also meant that officials would “have to say no to excellent companies.”

Ms. Raimondo emphasized the need to bolster domestic production of the most technologically advanced chips, which are made largely in Taiwan.

Federal officials plan to award about $28 billion of the grants to firms that make such leading-edge chips, Ms. Raimondo said. Those semiconductors — which are produced by companies including the Taiwan Semiconductor Manufacturing Company, Intel and Samsung — are used in artificial intelligence, smartphones, supercomputers and the most sensitive military hardware.