New Micron factories

US government promises billions to chip manufacturer

The US government has announced another billion-dollar subsidy for a manufacturer of semiconductors. The US company Micron will receive up to 6.1 billion dollars (5.7 billion euros) for new plants in the states of New York and Idaho, the White House announced on Thursday. The company also stands to gain up to 7.5 billion dollars, which the US Department of Commerce could make available in the form of loans.

Micron plans to invest 50 billion dollars in the USA by 2030, the White House explained. A further 125 billion dollars could be added in the following 20 years. The projects in New York and Idaho are "the largest private investments ever" in the two states, added President Joe Biden's administration. The new manufacturing facilities are expected to directly create 70,000 new jobs.

"Many new high-tech jobs"
"We are pleased to make these significant investments in the US, which will create many new high-tech jobs," explained Micron CEO Sanjay Mehrotra in a statement from the Department of Commerce. The aim is to "relocate the development and production of the most advanced semiconductors" to the USA and thus "protect our economic and national security", added Secretary of Commerce Gina Raimondo.

Chips are needed to power everything from smartphones to fighter jets. They are also becoming increasingly important for the automotive industry and for electric vehicles in particular. The global chip industry is dominated by a few companies, including TSMC in Taiwan and Nvidia based in California.

Previously dependent on Asia
The USA is highly dependent on Asia, especially for the production of semiconductors. Biden wants to counteract this with the so-called Chips and Science Act: The act provides for support of 52.7 billion dollars for companies that relocate production to the USA.

The South Korean manufacturer Samsung has already received a commitment of 6.4 billion dollars for a new plant in Texas as part of this. TSMC wants to build a third plant in Arizona and will receive 6.6 billion dollars from Washington.