London Daily

Focus on the big picture.
Thursday, Aug 20, 2026

US aims to create semiconductor manufacturing clusters with Chips Act funds

US aims to create semiconductor manufacturing clusters with Chips Act funds

At least two chipmaking ecosystems would be created by 2030, Commerce Secretary Raimondo says

The U.S. will target funds from the $53 billion Chips Act to create at least two semiconductor manufacturing clusters by 2030, according to Commerce Secretary Gina Raimondo, marking the initial stages of a plan to bring more chip manufacturing back to the U.S.

The aim would be to create ecosystems that would bring together fabrication plants, research-and-development labs, final packaging facilities for assembly of chips and the suppliers needed to support each phase of the operation, Ms. Raimondo said.

"When we are done implementing this by 2030, America will design and produce the world’s most advanced semiconductor chips," she told reporters in a briefing Wednesday.

U.S. Secretary of Commerce Gina Raimondo listens as U.S. President Joe Biden participates virtually in a meeting on the Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America Act, in the South Court Auditorium at the White House on


Ms. Raimondo is scheduled Thursday to outline the plans in a speech at Georgetown University. Next week, the Commerce Department is set to disclose further details on how companies can apply for funds.

Ms. Raimondo didn’t say where the clusters would be located, but Arizona, Ohio and Texas would likely be in the running based on investment plans by companies that now produce leading-edge chips: Intel Corp., South Korea’s Samsung Electronics Co. and Taiwan Semiconductor Manufacturing Co.

Intel has said it would invest $20 billion each in facilities in Chandler, Ariz., and New Albany, Ohio. TSMC has a $40 billion project under way in Phoenix, and Samsung Electronics is investing $17.3 billion in a plant in Texas.

Micron Technology Inc. and Texas Instruments also have disclosed investment plans.


The program has already triggered an investment boom, with U.S. and foreign manufacturers unveiling more than 40 projects for total investments close to $200 billion, according to the Semiconductor Industry Association, a trade group.

The Chips Act was signed into law in August by President Biden following its passage in Congress with bipartisan support. It provides $39 billion in incentives to help build and expand manufacturing facilities and more than $12 billion for research and development, as well as workforce development.

WASHINGTON, DC August 9, 2022: US President Biden signs into law the CHIPS and Science Act of 2022, on the South Lawn of the White House in Washington, Tuesday, August 9, 2022. Left to right: Founder and CEO of SparkCharge Joshua Aviv, US President J


The legislation came after a shortage of semiconductors hurt the production of autos, appliances and other products during the pandemic and concerns grew about the concentration of advanced-chip production in East Asia as economic rivalry with China intensified.

Industry advocates have expressed concerns whether funding might be spread out too thinly, or if the U.S. would be able to field enough skilled workers to build and operate new facilities. Ms. Raimondo said the government would be pressing chip companies to join with high schools and community colleges to train more than 100,000 new technicians in the coming years.

As companies shifted factories overseas in search of cheaper labor and production costs, the U.S. share in the global semiconductor production has fallen to around 10% from 37% in 1990. The U.S. doesn’t mass-produce the most advanced chips, defined as those smaller than 5 nanometers, while Taiwan, at the center of geopolitical tensions with China, accounts for 85% of those.

"The Chips Act is so essential because over the past few decades, we as a country have taken our eye off the ball and let chip manufacturing move overseas," Ms. Raimondo said.

Will Hunt, an analyst for Georgetown’s Center for Security and Emerging Technology, recommends the U.S. reshore enough capacity to become fully sufficient in producing the most advanced chips.

Mr. Hunt, who now serves as a Commerce Department adviser, said in a 2022 report that $23 billion of incentives provided through the Chips Act would allow the three companies with such technologies—Intel, Samsung and TSMC—to maintain or establish long-term presences in the U.S. to meet the domestic needs through 2027.


Ms. Raimondo said the Chips Act would also fund plants making advanced memory chips—a segment now experiencing oversupplies and falling prices—on "economically competitive and sustainable terms." The U.S. also will increase its production capacity for current-generation and mature node chips, needed for autos, medical devices and defense equipment, she added.

The rollout of the application process is expected to intensify the competition among companies vying for the subsidies.

Ms. Raimondo said the selection of recipients will be driven by how their plans fit into the government’s national security goals. "The purpose of this legislation isn’t to subsidize companies because they’re struggling in this cyclical downturn. It isn’t to help companies necessarily become more profitable in America," she said. "The reality is the return on our investment here is the achievement of our national security goal."

She added that there will be "many disappointed companies" over the amounts they will receive.

The new clusters will be built by union workers as called for under the terms of the Chips Act, Ms. Raimondo said, and afterward will be a source of thousands of jobs, many of which won’t require a college degree.

The Chips Act will also fund a research- and-development program called the National Semiconductor Technology Center, which will bring together universities, the industry, entrepreneurs and private capital to work on advanced technologies, she said, and help meet the need to triple the number of college graduates in semiconductor-related fields over the next decade.

Newsletter

Related Articles

0:00
0:00
Close
Prince Harry and Meghan to Move Back to Britain With Their Children
England and Wales Have Fewer Than 1,800 Prison Places Left for Men
Suspected People Smuggler Arrested After Investigation Identified Him
Children's Doctors Warn That Vaping Can Lead Young People to Smoking
Hundreds of Thousands of Students Receive GCSE and Vocational Results Across England, Wales and Northern Ireland
Here Is What Can Never Happen in Your Country: Taiwan Is Giving Money to All Its People Because It Collected Too Much Tax
UK Inflation Rises to 2.9% as Energy Bills Jump
UK Issues New Conduct Guide for Asylum Seekers on Consent and Respect
Moderna Shares Surge After Positive Personalized Skin Cancer Trial Results
UK Markets Watch US National Debt Surpass Forty Trillion Dollars
UK Broadcasters Urge Government to Invest in Digital Participation and Broadband
CVC Capital Partners and Standard Life Launch Two Billion Pound Pension Risk Transfer Venture
UK Private Sector Productivity Growth Accelerates in Second Quarter
UK Foreign Secretary Ed Miliband Condemns Israeli E1 Settlement Tender
UK Watchdog Investigates Trainline, Virgin Atlantic and RED Driving School Over Hidden Fees
Prince Harry and Meghan Markle Plan Move to Private Home Outside London
UK Retail Sentiment Improves as Summer Spending Boosts Consumer Confidence
UK Aid Cuts Draw Warnings From Charities Over Humanitarian Consequences
UK Financial Conduct Authority Issues Guidance for Motor Finance Redress Scheme
UK Met Office Launches Aviation Programme to Reduce Climate Impact of Persistent Contrails
Former UK Civil Service Chief Received Record 500,000 Pound Severance Payment
West Midlands to Bring Bus Network Under Public Franchising Model
UK Government Drops Plan to Relax Affordable Housing Requirements After Backlash
UK Reaffirms Military Support for Ukraine Despite Russian Hybrid Warfare Threats
UK Technology Sector Expands Nearly 8 Percent as Digital Industry Outpaces Wider Economy
UK Drought Threatens Harvests Across England and Wales as Food Inflation Risks Persist
UK Government Pledges 442 Million Pounds to End Rough Sleeping by Christmas
UK Government Signals Willingness to Reconsider Digital Services Tax Amid US Tariff Threats
UK Inflation Rises to 2.9 Percent as Energy Costs Threaten Economic Recovery
NHS Hospitals Cancel Surgeries as Extreme Heat Pushes Ward Temperatures Above 40 Degrees Celsius
UK Heatwave Forces Emergency Measures as Wildfire Risk, Hospital Disruption and Drought Intensify
A Sleepless Night on Wall Street: Nasdaq to Begin Nearly Round-the-Clock Trading
"The First in the World": 69-Year-Old Protested Artificial Intelligence—and Went to Jail
Ukraine's Ousted Defence Minister Calls for Wartime Presidential Election
UK Marks Ten Years of Night Tube as London Weekend Usage Exceeds Eighty-One Thousand Journeys a Night
Met Office Issues Thunderstorm Warnings Across Northern Ireland Over Flash-Flood Risk
Frasers Group Raises Stake in Hugo Boss to Nearly Forty-Eight Percent
Scottish Clyde Marine Pilots Prepare for Strike That Could Disrupt Glasgow and Greenock Shipping
Twenty Passengers Injured After Southern Train Derails Near Lewes in East Sussex
Government Rules Out High-Speed Rail Revival Between West Midlands and Northern England
West Midlands Bus Network Returns to Public Ownership in Twenty-Four Million Pound Deal
UK Competition Watchdog Targets Trainline, Virgin Atlantic and RED Driving School Over Drip Pricing
Northern Ireland Health Minister Mike Nesbitt Resigns After Dispute Over Causeway Hospital Surgery Closure
UK Long-Term Government Bond Yields Rise to Five Point Eight Five Percent as Borrowing Costs Surge
UK Government Overhauls Planning Rules to Push Housing Development Near Major Transport Hubs
UK Health and Economic Pressures Highlight Wider Strain on Households and Public Finances
UK Prime Minister Andy Burnham Reaffirms Full Support for Ukraine Amid Russian Warnings
Sainsbury’s Suspends Live Facial Recognition at London Store After Customer Misidentified
Artists Urge UK Prime Minister Andy Burnham to Reject New North Sea Oil and Gas Licensing
UK Government Awards Four Hundred and Fifty-Six Million Pound Civil Service Training Contract to EY and KPMG
×