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Semiconductor Companies Gear up to Seek Federal Funding to Open U.S. Plants

The Semiconductor Industry Association, the trade group that represents Intel (NASDAQ: INTC) and other U.S. semiconductor companies, plans to lobby the federal government for billions of dollars in funding to build chip plants on U.S. soil, reportsa the Wall Street Journal.

Citing a draft of the proposal put forth by the Semiconductor Industry Association, whose members also include Broadcom, Micron, and AMD, the Association reportedly wants the federal government to offer up $37 billion in funding to states wooing semiconductor companies and for research and development.

IMAGE SOURCE: GETTY IMAGES.

The industry trade group wants $15 billion earmarked for grants that states can use as incentives to lure chip plants, $5 billion for a new chip factory that the government and the private sector would create, and $17 billion for federal research. The plants will be built in the U.S., but the funding would go to both U.S. and foreign companies.

The semiconductor industry and the White House have been holding talks about how to reduce U.S. reliance on China for chip production as tensions between the two nations heighten.Intel and Taiwan Semiconductor Manufacturing are among the semiconductor companies that have participated talks with the White House about building chip plants in the U.S. Following news of those talks, TSMC announced that it will build a $12 billion chip fabrication plant in Arizona, which will lead to more than 1,600 jobs. Construction will commence in 2021.

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Donna Fuscaldo has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Taiwan Semiconductor Manufacturing. The Motley Fool recommends Broadcom Ltd and Intel. The Motley Fool has a disclosure policy.


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