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Intel could shift future investments overseas if the CHIPS Act fails in Congress

 A 3D rendering of the two chip fabs that will be built in central Ohio. The fabs are set to begin construction later in 2022, with production set to kickoff in 2025.
Courtesy of Intel
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https://www.intel.com/content/www/us/en/newsroom/news/intel-announces-next-us-site-landmark-investment-ohio.html
A 3D rendering of the two chip fabs that will be built in central Ohio. The fabs are set to begin construction later in 2022, with production set to kickoff in 2025.

Intel CEO Pat Gelsinger could shift future investments overseas if a $52 billion subsidy for chip manufacturers fails to pass in Congress, impeding the company's growth in Ohio.

Gelsinger spoke Tuesday with Ohio Republican Senator Rob Portman at the Aspen Ideas Festival in Colorado.

Gelsinger said the $20 billion commitment in Ohio for two semiconductor plants does not change without money from the CHIPS Act. The subsidy would give U.S chip manufacturers $3 billion to build those factories. It costs $10 billion to do so. But without it, the potential $100 billion investment in Ohio is not possible.

“It is not economically viable for us to compete in the world market if everyone else that we’re competing with is seeing 30% to 50% lower cost structures,” he said.

Gelsinger said countries in Europe and Asia offer those kinds of subsidies.

“We want to go first and bigger in Ohio, but without help, without incentives, we’d end up most likely investing in Europe as a result,” he said.

In a statement from Intel, spokesman William Moss said "nothing has changed since Pat's remarks. We are excited to begin construction on a new leading-edge semiconductor manufacturing plant in Ohio...it is time for congress to act so we can move forward at the speed and scale we have long envisioned for Ohio and our other projects."

If the subsidy passes, Intel intends to build six additional semiconductor plants in Licking County.

The company delayed a groundbreaking ceremony in Licking County due to inaction from Congress. Gelsinger hopes Congress will pass the bill before the legislature recess in August.

The DeWine administration said in a statement that "these comments are similar to those he [Gelsinger] made at the Intel announcement choosing Ohio earlier this year, so yes, we remain confident, and Governor DeWine agrees that Congress should pass the CHIPS Act right away."

Construction on Intel's nearly 1,000-acre site is underway.
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Tyler Thompson