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The US’s ambition to bolster its domestic semiconductor manufacturing capabilities has encountered another hurdle.
Intel is delaying the production timeline for its $20 billion Ohio chip factory project, citing difficult market conditions and a slow distribution of US government incentives, according to a report by The Wall Street Journal.
Originally, Intel targeted a production start by 2025, but the tech giant now says the construction of its manufacturing facilities won't be completed until late 2026. And as for the actual chip production, that's on hold until they can install all the complex machinery needed to manufacture advanced semiconductors.
- Currently, around 800 people are working on the site northeast of Columbus, Ohio, but Intel’s expecting that figure to climb to several thousand by the end of the year.
- Intel expects the project to create 7,000 construction jobs and potentially attract up to $100 billion in investment over time.
The Intel delay comes just weeks after Taiwan Semiconductor Manufacturing (TSMC) Chairman Mark Liu announced a second delay in ramping up chip factories in Arizona, with TSMC leadership also citing delays in receiving government incentives as a big factor in their decision.
Big picture: Intel expects to receive considerable funding as part of the $53 billion US Chips Act funds. But so far, Uncle Sam has been slow in distributing the grants, with the lion’s share of that cash still up for grabs. With most domestic chip fab projects already behind schedule, pressure is mounting on the US government to accelerate its support mechanism if it wants to see the US chip production dream become a reality anytime soon.
