The chip bill, which the US government has been introducing for a long time, has finally reached a critical moment of issuing a large amount of subsidies. On Monday, US Commerce Secretary Raymond stated that the Department of Commerce plans to begin funding within two months.
Raymond said that he is currently in very complex and challenging negotiations with chip companies. She also promised to release more announcements related to subsidies within the next six to eight weeks.
The total scale of this chip program in the United States is $39 billion, and these subsidies will support chip companies in building new factories, reducing production cost pressures, investing in supply chains, and more advanced research. The subsidy cap can reach 35% of individual project capital expenditures.
Raymond added that the related investments are highly complex and groundbreaking. Both in terms of scale and complexity, the projects proposed by TSMC, Samsung, and Intel for development in the United States are unprecedented attempts.
Stabilize people's hearts
The US chip bill was approved by Congress in August 2022, but so far, the US government has only issued two small subsidies from the plan, which has been criticized by the industry for slow government approval.
But Raymond has always stated that the US government's subsidy program is not lagging behind. However, recently Intel announced a delay in the construction of its $20 billion factory in Ohio, USA, one of the important reasons being interpreted as the US government's delay in providing chip aid.
At the same time, TSMC and Samsung Electronics have recently announced that they will continue to invest billions of dollars in building new factories in Asia. Analysts believe this means that these two semiconductor giants will to some extent shelve or slow down their factory construction in the United States.
Although TSMC and Samsung's factories in the United States may still be profitable, it clearly goes against their original intention to transfer global chip production capacity to the United States. And the root cause may also be partly related to the US government's failure to provide timely subsidies to TSMC and Samsung Electronics.
This is probably one of the reasons why Raymond disclosed the subsidy distribution time in advance, in order to stabilize the confidence of the chip industry in the United States.
In addition, Raymond also added that although the chip industry has always had cyclical problems and the current market situation is not good, she believes that artificial intelligence will drive the recovery of chip demand in an unprecedented way.