white house proposes updates to u.s. chips act
Washington D.C., Friday, 14 February 2025.
The White House plans to alter the U.S. CHIPS and Science Act funding terms amid existing payout delays. This move could impact major U.S.-operating companies like NVIDIA, ASML, and TSMC. These changes may affect industry dynamics and company stock values, sparking significant interest across the semiconductor sector. The review might lead to shifts in agreements previously settled under the Act, which allocated $39 billion to enhance U.S. semiconductor manufacturing. Such revisions could also introduce new conditions focusing on union labor and childcare support for factory workers. The ongoing evaluation by the administration has generated discussion within industry groups, which seek input on improving the program’s implementation. As the White House navigates these potential adjustments, the semiconductor industry keenly watches for how these policies will unfold and influence both domestic production and global operations.
Core funding adjustments and market impact
The White House is reviewing the $39 billion CHIPS Act allocation structure [1][2][3], with some disbursements already facing delays. Global Wafers has confirmed that its $406 million funding agreement is under scrutiny [4]. Intel has received $2.2 billion in payments to date, while TSMC secured $1.5 billion before the new administration took office [4]. These developments have created uncertainty in the semiconductor sector [GPT].
Labor and facility requirements
A key focus of the proposed changes centers on labor requirements and facility operations [1][3]. The administration is particularly concerned about provisions mandating union labor for factory construction and affordable childcare services for workers [3][4]. These requirements, originally added under the Biden administration, are now being reassessed under Trump’s executive orders targeting diversity and inclusion programs [4].
International expansion concerns
The White House has expressed dissatisfaction with companies receiving CHIPS Act funding while simultaneously expanding operations overseas, particularly in China [4]. Intel’s announcement of a $300 million investment in Chinese assembly and testing facilities, following their CHIPS Act funding approval, has highlighted these concerns [4]. Major beneficiaries including TSMC, Samsung Electronics, and SK Hynix maintain significant manufacturing presence in China [4].
Industry response and adaptation
The Semiconductor Industry Association has begun consulting with members about potential improvements to the program [1][4]. David Isaacs, the association’s vice president of government affairs, emphasized the importance of maintaining manufacturing incentives while expressing willingness to work with Commerce Secretary nominee Howard Lutnick to streamline requirements [4].