The money would include $5 billion to support the construction of a wafer fab and $15 billion in grants for states to use to attract semiconductor investment, the WSJ said referencing a draft plan. The remaining $17 billion would be for federal research funds, the report said.

The US and China are in the midst of a trade war that has seen the US government exert control and restrict chip exports to China (see US tightens restrictions on Huawei’s chip supply) with a particular focus on the world’s leading telecommunications company Huawei.

At the same time the US is seeking to reduce is own dependence on external chip manufacturing (see TSMC dragged to the altar of US manufacturing). Under the SIA proposals the wafer fab subsidy would be would be available to US and non-US-based companies. However, the article also speculates that it might be more likely to go to Intel which is proposing a fab investment (see US talks to Intel, TSMC about building local foundry fabs).

The SIA has come out in support of the introduction of the ‘Endless Frontier Act,’ a bipartisan, bicameral bill that is seeking to allocate more than $100 billion to science and technology initiatives.

The purpose of the bill would be to maintain and build on U.S. scientific and technology leadership – including in semiconductors.

The Endless Frontier Act would authorize $100 billion over 5 years and establish a new Technology Directorate to fund 10 key technologies. These would include semiconductors, materials science, artificial intelligence, quantum computing and communications technologies.

While supporting the bill the SIA may be drawing up its own plans to try and make sure that semiconductors, with its capital intensity, does not miss out in a “beauty competition” against other, more recently developed technologies.

Related links and articles:

News articles:

US talks to Intel, TSMC about building local foundry fabs

Intel fail foreseen: ARM reportedly wins Mac computer processor design-ins

US tightens restrictions on Huawei’s chip supply

TSMC dragged to the altar of US manufacturing

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