Intel gets 7.86 billion US dollars in subsidies for chip fabs

The current US government under President Joe Biden is pouring billions of US dollars into the promotion of chip manufacturing in the USA. Intel reports that it has now been able to conclude agreements for a total of 7.86 billion US dollars from the CHIPS Act. The money will flow into the chip fabs currently under construction in Arizona, New Mexico, Ohio and Oregon.

The sum is slightly lower than the previously stated figure of 8.5 billion US dollars; Intel does not give any reasons for this. In addition, Intel will receive tax credits depending on the actual investment amount.

Independently of this, Intel was already able to secure up to a further 3 billion US dollars from the CHIPS Act in September for the secret "Secure Enclave Program" of the US Department of Defense (DoD).

Intel is currently in difficult waters, is making heavy losses, is laying off thousands of people and has already written off parts of its existing chip production facilities.

The company is also raising money through sale-and-leaseback agreements. For example, Intel wants to sell the research and development campus in Folsom to an investor and then lease the buildings. Intel is also looking for investment partners for the expensive fabs.

Intel's hopes are pinned on transforming the company into a leading chip contract manufacturer (foundry). To this end, the first production technology that is competitive with TSMC, Intel 18A, is to be launched in 2025. Due to sluggish sales figures, a weak outlook and dwindling capital reserves, the transformation process led by Intel CEO Pat Gelsinger is considered risky.

Fabs stopped or delayed

Intel is currently concentrating its investments mainly on the USA. Intel has already put the construction of the planned Fabs 29.1 and 29.2 in Magdeburg and the packaging plant in Wroclaw on hold. A project in Israel is also on hold.

(ciw)