U.S. Commerce Secretary May Delay CHIPS Act Grants Without Major Project Expansion
Commerce Secretary Howard Lutnick hints at withholding CHIPS Act funding unless semiconductor companies significantly increase their U.S. investments, aiming to boost domestic chip manufacturing.
KEY INSIGHTS
- Commerce Secretary Howard Lutnick suggests potential delays in CHIPS Act grants if recipients don’t substantially grow their semiconductor projects within the U.S.
- Reports indicate Lutnick urges awardees to emulate Taiwan Semiconductor Manufacturing Company (TSMC), which committed an additional $100 billion beyond its initial $65 billion U.S. investment.
- Former President Donald Trump, a vocal critic of the CHIPS Act, recently established a new office to enhance investment negotiations related to the program.
Howard Lutnick, the U.S. Commerce Secretary, has reportedly signaled that CHIPS Act funding promised by the Biden administration may be withheld if semiconductor companies fail to significantly expand their U.S.-based projects.
According to Bloomberg, citing sources familiar with the matter, Lutnick expects companies receiving CHIPS Act awards to follow the lead of Taiwan Semiconductor Manufacturing Company (TSMC), which has pledged an extra $100 billion on top of its initial $65 billion investment plan to build semiconductor plants in the United States.
Bloomberg further reports that Lutnick aims to stimulate billions of dollars in chip manufacturing investments without increasing the total award amounts.
The Department of Commerce has not yet commented on these developments.
Former President Donald Trump has criticized the CHIPS and Science Act—a 2022 law championed by President Joe Biden that allocates over $50 billion to enhance domestic semiconductor production.
On Monday, Trump signed an executive order establishing the United States Investment Accelerator within the Department of Commerce. This office is tasked with facilitating and accelerating investments exceeding $1 billion in the U.S., with a focus on negotiating improved CHIPS Act deals compared to previous administrations, according to a White House fact sheet.
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