Arizona is a hub for chip makers like Intel and TSMC, and as the government prepares to release funds for the strategic industry, they are poised to receive a portion of the $52 billion under the CHIPS Act for semiconductor manufacturing and research. Discussions between commerce secretary Gina Raimondo, Senator Mark Kelly, the Phoenix mayor, and the president of Arizona State University took place last week.
Why it matters: Companies like Intel have been considering expanding manufacturing capacity for chips abroad in response to the global chip crunch that is crippling the care and electronics industry and fueling inflation. Semiconductors are key to power critical technologies from quantum computing, the internet of things, artificial intelligence, and fighter jets, to everyday laptops and coffeemakers.
- The CHIPS Act is an investment in domestic semiconductor manufacturing and aims to reduce the reliance on chips from abroad, boost the American economic competitiveness and domestic jobs, and protect from semiconductor sabotage.
- Texas, New York, and Ohio are also vying for subsidies. Arizona’s history with chip manufacturing dates back to the 40s, with over 110 chip-related companies in contrast to Ohio’s one major manufacturer. Arizona may have a leg up.
- The Commerce Department has said it will give preference to companies that invest in research, new facilities, and workforce training. Ms. Raimondo has previously commented that the CHIPS Act is “not a blank check to these companies. There are a lot of strings attached and a lot of taxpayer protections.”
