As the Biden administration prepares to leave office, it is accelerating the distribution of subsidies under the "CHIPS Act" to ensure the return of the U.S. chip manufacturing industry. According to informed sources, TSMC (TSM.US) and GlobalFoundries (GFS.US) have reached agreements with the U.S. government for billions of dollars in grants and special loans aimed at supporting the construction of new chip manufacturing plants in the U.S., bolstering the country's position in the global chip manufacturing sector. This agreement is expected to be officially announced in the coming weeks.
According to the preliminary agreement, TSMC plans to build three chip plants in Phoenix, Arizona, ultimately achieving mass production of advanced chips at 3nm and below. TSMC's U.S. plant project will receive subsidies of up to $6.6 billion and loans of $5 billion to expedite the construction of the production base. GlobalFoundries will receive $1.5 billion in subsidies and $1.6 billion in loans to support the construction of a new chip plant in New York and expand existing facilities.
Since its passage in 2022, the "CHIPS Act" aims to revitalize the U.S. chip manufacturing industry through $39 billion in subsidies, billions in loans, and a 25% tax credit. In addition to TSMC and GlobalFoundries, more than 20 chip manufacturing companies, including Samsung, Intel, and Micron, are also seeking funding to accelerate the production of advanced chips and supply chain components in the U.S. These companies have completed preliminary agreements and are conducting due diligence, with funds expected to be disbursed in batches following the signing of subsequent formal agreements.
The Biden administration's acceleration of subsidies also stems from criticism of the "CHIPS Act" by the incoming Trump administration. Trump has publicly questioned the subsidy policy and advocated for tariffs on foreign chip companies, which has raised concerns among overseas companies such as TSMC and Samsung. Analysts believe Biden wants to ensure the implementation of agreements before leaving office to fulfill his policy commitment to repatriate chip manufacturing and leave sustained policy support for the U.S. chip industry.
The reaching of this agreement marks significant progress for the U.S. in chip manufacturing. With TSMC's 4nm plant project making breakthrough progress in Arizona, the "reshoring" of U.S. chip manufacturing is gradually becoming a reality. However, Trump's statements have also added uncertainty to the future policy direction.
