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WASHINGTON (AP) – The Biden administration is providing $162 million to Microchip Technology to support domestic production of computer chips. This is the second funding announcement related to the 2022 Act, which aims to revive U.S. semiconductor manufacturing.
The incentives include $90 million for plant improvements in Colorado Springs, Colo., and $72 million for a plant expansion in Gresham, Ore., the Commerce Department said. The investment will allow Microchip Technology to triple its domestic production and reduce its dependence on overseas factories.
Much of the money will go toward manufacturing microcontrollers, which are used not only by the military but also in cars, home appliances, and medical devices. Officials said the investment is expected to create 700 construction and manufacturing jobs over the next 10 years.
Lael Brainard, director of the White House National Economic Council, emphasized that the funding will help curb inflation.
“Semiconductors are a key input for so many products that are essential to our economy,” Brainard said, noting that more chip production in the U.S. could cause higher prices for things like cars and washing machines. It added that the current supply problems would have been alleviated. In 2021, the country emerged from the coronavirus pandemic.
Inflation has since declined, but the scars left by the sudden rise in prices are hurting President Joe Biden’s public support.
In August 2022, Biden signed the bipartisan CHIPS and Science Act, which provides more than $52 billion to accelerate U.S. semiconductor development and manufacturing.
The Commerce Department announced in December that it had reached an agreement to provide $35 million to BAE Systems, which plans to expand its New Hampshire factory that makes chips for military aircraft such as the F-15 and F-35 jets. announced its first grant.
Government officials expect to commit to additional funding this year.
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