U.S. to announce billions of dollars in chip subsidies by March: WSJ report

The construction site for Samsung Electronics’ chip plant in Taylor, Texas, U.S. [Courtesy of Samsung Electronics]

The U.S. government’s plan to award billions of dollars in subsidies to companies that build new chip foundry plants is gaining momentum, with Samsung Electronics Co., Taiwan Semiconductor Manufacturing Co. (TSMC), and Intel Corp. considered as the biggest recipients.

The U.S. government has been engaged in discussions with the chip companies since the latter half of 2023 on the size of subsidies. Progress, however, has been slow.

The discussions picked up speed as U.S. President Joe Biden enhanced efforts to promote economic policy campaigns ahead of the U.S. presidential elections in November 2024.

Ohio and Arizona, where the chip companies are building factories, are considered swing states. TSMC has two plants under construction in Arizona, and Samsung Electronics has a $17.3 billion project in Texas.

The Wall Street Journal reported Sunday that the Biden administration is planning to award billions of dollars in subsidies by the end of March to the semiconductor companies to help build new factories in the United States.

This program is part of the CHIPS and Science Act, which allocates $52.7 billion in subsidies for semiconductor production ($39 billion), research and development ($13.2 billion), and technology security and supply chain ($500 million).

Industry sources expected announcements will be made before Biden’s State of the Union address on March 7.