Well, it seems like the US's CHIPS Act incentive might just see its demise under the current government, as it is claimed that the brains behind it have either left or got fired by DOGE.
Trump Previously Claimed the CHIPS Act Has Given Hundreds of Billions To Companies, Without Any Real Benefit, Called To End It
The CHIPS Act, introduced under the Biden administration, was seen as the first step by the US to restore its status as the dominating chip country. The primary aim of the incentive was to bring chip production to the country, and with it, we saw the likes of TSMC, Intel, and many others opening up new facilities in the region. However, US President Donald Trump hasn't been a fan of the initiative at all, claiming that companies got the "Biden money". In light of this, according to a report by Chosun, it has been revealed that the act looks to end pretty soon.
The Korean media states that over 120 employees out of 15 from the Commerce Department's Chip Program Office (CPO) have either been laid off or resigned from their positions. One of the notable names leaving the office is Dan Kim, who was SK hynix's former VP and joined the CPO as the chief economist three years ago. His departure suggests that the incentive won't focus much on South Korean companies like SK hynix or Samsung at all, which jeopardizes the future of the CHIPS Act.
Diving a bit into the specifics of the CHIPS Act, it is an incentive provided to companies in the semiconductor industry, which has $280 billion in grants, including $52 billion in federal investments and tax breaks for domestic semiconductor research, design, and manufacturing provisions. One of the primary beneficiaries were Intel and TSMC, both of which showed massive commitment towards producing in the US, but apart from them, firms like Samsung were too a part of the deal, with the Korean giant announcing a facility in Texas.
The layoffs at CPO are attributed to Elon Musk's DOGE division, which is working towards restructuring federal spending. While the abandonment of the CHIPS Act isn't certain for now, the future of the incentive is certainly indecisive for now. Given Trump's statements, it does hint that either the scale of subsidies would be scaled down tremendously or the act would be scrapped totally.
About the author: Muhammad Zuhair is a hardware and technology reporter for Wccftech, specializing in the semiconductor industry and the complex interplay between technology, manufacturing, and geopolitics. His coverage focuses on the corporate strategies and technological roadmaps of industry giants like TSMC, NVIDIA, Samsung, and Intel. Zuhair's expertise lies in deconstructing complex topics such as fabrication nodes (e.g., 2nm process), the economic impact of policies like the CHIPS Act, and the strategic development of AI infrastructure from NVIDIA, AMD and Intel.
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