London Daily

Focus on the big picture.
Thursday, Jun 18, 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
Health Authorities Warn of Rising Cases of Seasonal Respiratory Illnesses
BAE Systems and Rolls-Royce Advance Multi-Nation Fighter Aircraft Programme
National Archives Publish Declassified Documents on Cold War Energy Security Planning
British Retail Spending Rises Despite Continuing Cost-of-Living Pressures
Wales Launches Social Housing Pilot to Address Affordability Pressures
British Energy Companies Commit £5 Billion to Geothermal and Hydrogen Projects
Northern Ireland Debates Cross-Border Healthcare Partnership With the Republic of Ireland
UK Establishes National Artificial Intelligence Safety Centre With Leading Universities
UK Reports Decline in Small Boat Crossings After Expanding Intelligence Cooperation With France
Scottish Parliament Launches Inquiry Into Delays to Renewable Energy Projects
National Crime Agency Dismantles Alleged Multi-Million-Pound Money Laundering Network in London
Transport Strikes Disrupt Rail and Bus Services Across Northern England
United Kingdom and European Union Open New Security Dialogue on Defense and Border Cooperation
Bank of England Holds Interest Rates at 5% as Services Inflation Remains Elevated
UK Government Unveils Major National Health Service Reform Focused on Decentralization and Performance Funding
Government Advances New Airport Slot Rules to Ease Airline Operating Constraints
BBC Opens Flagship Science-Fiction Franchise to Competitive Production Bids
Chancellor Meets City Leaders Amid Concerns Over Gilt Market Liquidity
Rathbones Shares Fall Seventeen Percent After Regulatory Review Reveals Compliance Failings
United Kingdom Joins Group of Seven Initiative Using Artificial Intelligence and Quantum Computing for Cancer Research
Parliament Debates Doubling Tax Allowance for Pensioners After Major Public Petition
Measles Cases Exceed Seven Hundred in London and the West Midlands
British Military Leadership Faces Parliamentary Scrutiny After Defence Secretary's Sudden Resignation
House of Lords Begins Debate on Steel Industry Nationalisation Legislation
Parliament Advances Bill to Abolish NHS England and Create Single Patient Records
Parliament Fast-Tracks National Security Bill to Expand Powers Against Foreign Threats
United Kingdom and European Union Set July Summit to Deepen Post-Brexit Cooperation
United Kingdom Imposes Seventy New Sanctions on Russia and Expands Support for Ukraine's Nuclear Sector
United Kingdom Announces Social Media Ban for Children Under Sixteen
0British Government Investigates Reports of Russian Warship Firing Warning Shots Near Isle of Wight
UK Supreme Court Revises Legal Definition of Deprivation of Liberty
King’s Birthday Honours Recognise Contributions Across Science, Culture and Public Service
UK Ministry of Defence Reports Interdiction of Russian Shadow Fleet Vessel
UK and US Launch Joint Regulatory Programme for Medicines and Healthcare Products
Solicitor General Refers Murder Sentence to Court of Appeal Under Unduly Lenient Scheme
UK Launches £1.6 Million Mobile Museum Initiative to Expand Cultural Access
Judicial Pay Structure Undergoes Government Review Following Senior Recommendations
Government Confirms Nearly 180 New Youth Hubs Across the United Kingdom
UK Government Expands Careers Support Through Partnership with LinkedIn
Digital News Report Highlights Growing Global Concern Over AI and Information Overload
UK Chancellor Reaffirms Fiscal Discipline and Borrowing Reduction Strategy
UK Government Invests £219 Million in Sustainable Aviation Fuel Development
Rolls-Royce Small Modular Reactors Secures Major Swedish Export Contract
Government Confirms Locations for Nearly 180 Youth Hubs Across Great Britain
UK Government Partners with LinkedIn to Expand Employment Support Services
Reuters Institute Report Flags Rising Public Anxiety Over News and Information Overload
UK Government Commits £219 Million to Expand Sustainable Aviation Fuel Industry
Chancellor Convenes Market Engagement Group to Assess UK Economic Outlook and Productivity Risks
Rolls-Royce Wins Multibillion-Pound Swedish Contract for Small Modular Nuclear Reactors
Government to Ban Social Media Access for Under-Sixteens Across the United Kingdom
×