Texas Instruments awarded $1.6 billion in CHIPS Act funding for domestic silicon production

Texas Instruments is the latest recipient of CHIPS Act funds. The 2022 law, signed by President Biden to boost domestic silicon production in the face of increasing Chinese chip imports, will award TI $1.6 billion in grants. The company will also receive $3 billion in loans and tax credits that could amount to $6 to $8 billion.

The effort is expected to create over 2,000 US manufacturing jobs at Texas Instruments’ new plants and “thousands of indirect jobs” for construction, suppliers and supporting industries. TI says it expects to receive another $10 million to fund workforce development.

TI’s grant money will go towards three chip fabs already under construction in Texas and Utah. The plants will produce 300mm silicon wafer chips under the bill’s $2 billion minimum set aside for legacy chips. The CHIPS Act primarily focuses on cutting-edge silicon, like those increasingly used for AI. TI’s production will go towards less advanced processors for things like smartphones, appliances and national defense. GlobalFoundries was awarded $1.5 billion for legacy silicon production in February. With Friday’s awarding of funds for TI, the government has now met its minimum quota for legacy chips.

Bloomberg notes that China has recently boosted its investments in legacy chips. Along with creating US jobs, the CHIPS Act was designed to curtail China’s influence as silicon becomes more of an essential global resource. Other recipients include Intel ($8.5 billion), TSMC ($6.6 billion) and Samsung ($6.4 billion).

Texas Instruments said it will spend around $40 billion in Utah and Texas, including two more factories in Sherman, TX. However, those aren’t expected to be operational until after 2030. For the CHIPS Act, the Commerce Department prioritizes projects that can be completed by the decade’s end, leaving those delayed plants without federal funding.

The $280 billion CHIPS Act passed in 2022 with 64 votes in the Senate and 243 in the House. The bill included $39 billion in subsidies for domestic chip manufacturing, 25 percent tax credits for manufacturing costs and $13 billion for workforce training.

After the bill passed in 2022, Biden said it would “strengthen our national security by making us less dependent on foreign sources of semiconductors.” He noted that it included “guardrails to ensure that companies receiving tax payer dollars invest in America and that union workers are building new manufacturing plants across the country.”