Posted on 06/30/2022 3:48:06 PM PDT by anthropocene_x
“The rest of the world is moving rapidly despite the inability of Congress to get this finished,” said Gelsinger on a panel at the Aspen Ideas Festival.
Congress passed the CHIPS Act as part of the National Defense Authorization Act in 2021 but never appropriated a budget for its programs. The money for subsidies is currently stuck in negotiations as the House and Senate attempt to reconcile differences on a broader package of policies to help the U.S. tech industry compete with China.
Last week, Intel said it would delay the groundbreaking ceremony of a new $20 billion facility in Ohio owing to a lack of government funds. “I hate the idea of announcing a delay,” Gelsinger said on Tuesday, claiming Intel wanted to “go first and bigger in Ohio.” But he warned that without funding, Intel “would end up investing a lot more in Europe as a result.” The chipmaker already plans to spend about $35 billion to expand its production in the European Union, including a new $18 billion facility in Germany.
In February, the European Union earmarked about $46 billion in funding for chip manufacturing as part of the European Chips Act. Of that, $7.3 billion will be used to help subsidize Intel’s new Germany plant.
Japan is covering 40% of a new TSMC plant in Kumamoto, drawn from a $4.5 billion fund to support the country’s semiconductor industry.
Gelsinger said the U.S. needs to invest in chip manufacturing as a matter of national security, shifting the center of production away from East Asia. “This is the future of geopolitics,” he said.
(Excerpt) Read more at fortune.com ...
The logical precursor to this subsidization of non-competitive industry is Solyndra.
full disclosure: I am invested in AMD.
> We need domestic computer chips.
yes.
> There’s a plant being built in Arizona.
Yes, TSMC (ally of AMD).
> We need another.
not if it will not be competitive and only used to enrich politicians and hedge funds, and soak taxpayers and investors.
“The money for subsidies”
Will I be receiving a thank you card from Intel for my generous donation???
I would be wary of trusting Gelsinger as far as one could spit. The guy does not have a good delivery track record. Intel does not have a recent good delivery track record.
Gelsinger has failed to deliver on several recent Intel milestones. That is one reason why Intel stock has flatlined over the last few years. Having failed in delivering the promised new line of Intel processors (the existing line suffers from overheating, lack of size reduction, power consumption, etc wrt competition), Gelsinger is losing credibility in making future promises in that area. Therefore he is making promises in an area that is a relative unknown for Intel. To do this, he needs to build new factories. However, he does not have the capital. So he is begging any government that will listen for subsidies. It’s a house of cards and very risky.
Intel is Solyndra, part II.
https://www.tomshardware.com/news/tsmcs-arizona-fab-construction-emerges-at-breakneck-speed
IIRC Trump and TSMC cooked up the Arizona site expansion in mid 2020. If TSMC Arizona facility comes up as scheduled in 2024, that makes the start to finish time for such a facility is about 48 months.
Gelsinger wants immediate and large subsidies for a facility to be completed in Ohio in about 48 months. Why? This change of direction for Intel takes the delivery heat off of Gelsinger from investors for that period of time. But in 48 months, as we know from Solydra, anything can happen. 48 months gives Gelsinger 4 years to crow about maintaining Intel while preparing a golden parachute for himself and sending kickbacks to DC beltway insiders— to be pulled about 47 months from the subsidy grant date. TSMC, Renesas and others will still be around 48 months from now. Not only does Intel need capital it cannot now raise from private investors (why not???), Intel also has to ramp up expertise that they do not currently possess to sit at their table.
Pure corporate welfare.
Executive bonuses should be extra good the year the subsidies are received.
Intel CEO hasn’t learned how congress works yet bribes.
If we take a step back and look at the bigger picture, we can see that line every in the Federal Budget, has it’s supporters. They can even make a case for the spending.
Congress in the position of playing Santa Claus, Congress just says yes to everyone, this way they get re-elected.
No one says, “I voted for “Joe Blow” because he failed to bring home the bacon.”
Intel can get free money just for asking, after all they have our balls in a vice, so who can blame they. Ukraine needs support as to not appease a mad dictator, so yes it’s good to save innocent people.
The sad part is we haven’t even begun to talk about how no one has a penny in their so called “social security account”.
So sure let’s write Intel a check, stand up to Russia, and fund farmers and NPR...
I wonder how many dollars Congress spends for every dollar it take in?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.