Using $19.5 billion in federal grants and loans—and with the hopes of securing another $25 billion in tax breaks—technology company Intel said it plans to spend $100 billion over five years on building and expanding factors in four states: Ohio, New Mexico, Oregon and Arizona. The federal funds are being delivered to Intel under the CHIPS act.
The hub of the spending plan will be building what CEO Pat Gelsinger said will be “the largest AI chip manufacturing site in the world,” to be located in Columbus, Ohio.The construction could begin as early as 2027, though Gelsinger says that could be pushed back if the chip market starts to slip.
Intel will also renovate sites in New Mexico and Oregon, as well as expand its operations in Arizona. The company’s rival, Taiwan Semiconductor Manufacturing Co., is also building a large factory that it hopes will also received federal funding. About 30% of the $100 billion will go to construction costs, including piping, concrete and labor, while the rest will be spent on purchasing chipmaking tools from a variety of companies.
Despite the massive spending plan, “it will still take three to five years for Intel to become a serious player in the foundry market” for cutting-edge chips, said Summit Insights analyst Kinngai Chan, adding that TSMC could remain the leader in the industry for “some time to come.”
