The CHIPS Act, signed into law in August 2022, aims to bolster semiconductor manufacturing in the US, not only for business purposes but also for broader strategic goals, such as reducing dependence on Asian manufacturing.

Soon, funds designated to attract chipmakers to US soil will be distributed, with Samsung, Intel, and TSMC poised to receive billions in grants and subsidies.

According to Bloomberg, Samsung is anticipated to receive $6 billion,
TSMC over $5 billion, and Intel up to $10 billion in federal funding. All three companies have plans for or are constructing fabs in the US.

Samsung is constructing a 4nm EUV manufacturing facility in Taylor, Texas, set to begin operations in 2025. Originally estimated at $17 billion, the cost has risen to $25 billion due to inflation and higher labor costs, as reported by Reuters. While it’s expected that Samsung might use the funds to offset these cost increases, its expansion beyond Texas remains unclear for now.

Intel is building facilities near Columbus, Ohio, expanding its Arizona facilities, and opened its Fab 9 plant in New Mexico in January. Delays in the Ohio plant’s construction have been mitigated by the incoming CHIPS funding, according to the Wall Street Journal.

TSMC earmarked $5 billion, a fraction of its planned $40 billion US investment. Its Arizona facility has faced delays, with TSMC Chairman Mark Liu mentioning the need to review incentives provided by the US government in an interview with CNN.

Now that the funds are set to be distributed, it will be intriguing to observe how chipmakers respond. While billions in CHIPS grants and loans are significant, considering the substantial costs of these advanced facilities,
one may question whether this funding will suffice as long-term incentives for continued investment.