Intel delays $28B Ohio chip fabs to 2030
139 comments
·March 1, 2025SamuelAdams
onlyrealcuzzo
How are they going to return that money when they lost ~$19B last year and paid out ~$2B in dividends?
JonChesterfield
They get to borrow it. Or they're insolvent, which seems plausible. Making heavy losses will do that eventually.
Tostino
Trump made claims he wants to cancel the chips act. I have a feeling that has something to do with the delay.
imgabe
Because this is what happens. You try to bribe companies and they just take the money and say “oh, yeah fuck off”. Just like all the telecom companies took billions of dollars to build high speed internet and did jack shit.
Instead impose tariffs and make building in the US mandatory.
soramimo
It worked for the TSMC plant.
okonomiyaki3000
So they think they can wait till 2030 when a different guy will be in the White House? They better think again.
numpad0
I think they think, it, strategic high tech investment in the US, is not worth doing. At least until 2030s.
klysm
They can make a bet on it, same way Apple is making “investments” with continent timing.
micromacrofoot
or they hope it's a bad look for "america first" and the delay prevents it from being cancelled
pclmulqdq
Is SpaceX going to return the billions for the Artemis contract from missing their milestones? This is generally what happens with corporate welfare - the people getting the handout win contracts by over-promising the most and then under-deliver.
klysm
Turns out you don’t actually have to hit milestones on grants. The unfortunate reality is grants are typically unrealistic in the same way VC backed startups vastly overestimate their growth curve. In order to win the grant, you’re competing against other ideas. It’s easy to win grants with ideas that aren’t feasible because they sound better than ideas that are actually feasible. It enables incredible amounts of grift once you understand how to exploit the dynamics. Look up SBIR mills
pclmulqdq
I had the displeasure of submitting a few honest SBIRs at one point in time. Needless to say, they were rejected for not being ambitious enough. It is actually so bad that there is an inverse relationship between your ability to get an SBIR and your ability to produce a commercial product - startups who try and fail are statistically more likely to succeed in the market than startups who get an SBIR (even with the benefit of the money).
hermannj314
I found a link on grant fraud from the OIG and to my non-legal mind this confirms exactly what you say.
Conflict of interest and bad accounting practices are the types of fraud being alerted to, but failure to perform apparently is not.
https://oig.justice.gov/sites/default/files/2020-02/GrantFra...
yapyap
SpaceX’s owner has a hand up the proverbial puppet running the United States of America right now, intel doesn’t.
somenameforme
Starship has been progressing relatively well because delays in these things are the norm, not the exception. A big issue is that the previous administration was weaponizing regulatory agencies against SpaceX to intentional delay launches.
It led to some amusing stories like this one. [1] SpaceX were required to prove that Starship wouldn't hit a shark when coming down in the ocean. So they asked if they could have the data on sharks, but the answer to that was no - apparently it was pseudo-classified for fear that shark fin hunters might get their hands on it. It all comes off as a comedy sketch, but it's real!
Artemis will never go anywhere, but it won't be because of SpaceX. SLS/Boeing play a key role, and the astronauts they barely managed to send up to the ISS like 9 months ago are still stranded there. By the time they're ready to fly SpaceX will certainly be fully capable of single-handedly delivering people to the Moon completely obsoleting the point of the big convoluted multi-company mission.
[1] - https://x.com/SawyerMerritt/status/1847846282410258876
oa335
The source is that information is the CEO of SpaceX.
rbetts
A quick search finds the environmental impact report that is the basis of this story: https://www.faa.gov/media/76836. To land a spacecraft in the ocean required a certification by the FAA. That certification required an environmental impact assessment.
Perhaps you prefer a world in which corporations can dump (even more) waste in the ocean?
pclmulqdq
SpaceX is missing its milestones. Boeing is missing its milestones. Why not both?
DonHopkins
Ketamine is a terrible drug that rots your brain.
tyleo
The real question is whether the fabs will ever come, or if they will be “too little too late”. As a former resident of Columbus, I’m skeptical of the Ohio government and Intel’s ability to get a value-positive operation running here.
So much of the Ohio population is hostile to the very acts like CHIPS which are funding this project and Ohio infrastructure generally. I have that on account of a couple civil engineers in Ohio who are friends and family.
mikeyouse
I don’t think it’s a coincidence that Intel announced the delay to the next presidential term.. The current administration is also hostile to the CHIPS act.. they’ve fired many of the administrators (the act is new enough that there were many probationary employers supporting it) and have told already-approved recipients that they are going to renegotiate the agreements. I’ve never seen such a self destructive administration..
BoxFour
> I don’t think it’s a coincidence that Intel announced the delay to the next presidential election year..
The next presidential election is in 2028, not 2030
Aurornis
Election in 2028, next president takes office in 2029, realistically 2030 is the earliest the CHIPS act and staff could be rebuilt.
The people overseeing the CHIPS act have mostly been fired or flagged for firing. Many of them were in their “probationary” period because they were recent hires.
The CHIPS act can’t be instantly restarted when the next president takes office. It has to be rebuilt. It has basically been sabotaged.
mikeyouse
Yeah typo on my part there, ty
rwyinuse
Based on last few weeks I'll be genuinely surprised if there will be fair elections in 2028.
mikeyouse
It’s a definite concern but fortunately elections are largely administered by the states so there’s at least a buffer between centralized authoritarians and the voting process.. That being said, I’m sure this DOJ is going to get up to all sorts of shenanigans with whoever is nominated.
elephanlemon
What’s still totally unclear to me is how much money Intel has actually received. If they got all of the 7.9 B, then I would assume it doesn’t matter to them if the act is cancelled? But it’s not clear to me how much has actually been paid out so far.
https://www.cnbc.com/2024/11/25/intel-close-to-8-billion-chi...
fluidcruft
There's absolutely no way they already have all the $7.9b. That's not how government contracts and accounting works. DOGE/Trump can just slice whatever remains of the rest of the contract and then they'll bicker at each other in court for a decade until nobody cares anymore.
okonomiyaki3000
Bold of them to assume there will be next presidential term.
EasyMark
the way they are setting up Trump toadies in all the police apparatus and people aren't nervous is amazing to me.
roland35
We certainly have our share of dumdums here in Ohio but I think the actual leadership is fairly reasonable, and they do really like $$ and wouldn't do anything to jeopardize investment.
Now, I am not sure how long we'll have "the old guard" type guys like dewine, so this comment might not age well!
mistersquid
> We certainly have our share of dumdums here in Ohio but I think the actual leadership is fairly reasonable, and they do really like $$ and wouldn't do anything to jeopardize investment.
Mike DeWine is governor.
On the Federal level, Ohio has Representative Jim Jordan and the current VP of the US, J.D. Vance.
How do you measure that “the actual leadership [of Ohio] is fairly reasonable”?
ceejayoz
DeWine, to his credit, has been notably independent on a number of fronts, from COVID restrictions to anti-trans legislation.
EasyMark
The republicans in Ohio will do what the republican in Washington are doing right now. Mark my words, whatever the King says goes, unless there is a national disaster or he has a complete dementia break down in public. Luckily, it's all built around his cult of personality and falls apart when he's no longer viable.
null
huijzer
Why are they hostile to the plans?
mikeyouse
Mostly because “China bad” and “Biden bad”.. same thing happening in Michigan. There were organized protests to stop Chinese and Taiwanese companies from building billion dollar battery facilities in poor rural areas. Just the dumbest timeline.
https://www.mlive.com/public-interest/2023/04/hundreds-rally...
freen
“Not invented here” syndrome.
The “Liberals” did it.
Kill Obamacare but don’t you dare touch my Affordable Care Act healthcare coverage. Etc etc etc.
ihsw
[dead]
mrtksn
What happens if the EU-USA relationship deteriorates to the point that EU doesn't sell lithography machines and other equipment to the US, doesn't accept imports made with chips from USA and requires these things be made in China, Korea or Japan?
The reason I'm curious about this is that in my understanding for a fab to become financially viable it needs to produce grotesque amount of chips.
Can America have state of the art fabs for a market of 340M people if the world becomes partitioned in the upcoming years? In Europe that was the main problem, people like to say that Europe lost on tech because of regulations but Europe lost on tech before EU become a thing, they simply didn't have a large enough local market for electronic components. Europeans got out of this market because it wasn't profitable, not because they couldn't figure out transistors etc.
alephnerd
> EU doesn't sell lithography machines
ASML's EUV Lithography IP is provided on contract by LLNL, and much of that IP is owned and implemented by Cymer LLC, ASML's US subsidiary.
And it's individual nation states (in this case Netherlands) that can even make decisions on export controls, not the EU. In most cases, the Netherlands has largely been aligned with the US, and knows how to manage Trump thanks to Mark Rutte.
EU Member states zealously guard their sovereignty in defense/NatSec and foreign relations matters, so it's less a question about the EU and more a question about Netherlands/France/Germany/<insert EU state here>
> requires these things be made in China, Korea or Japan
Most of the supply chain is already dependent on Japan and Korea and has been for decades.
European players have largely been limited to legacy node fabrication chains because of the heavy focus on the automotive industry in Europe and the capital crunch during the Eurozone recession.
That said, there are a decent number of European suppliers (eg. Merck for chemicals, ASML for EUV Lithography, Zeiss for optics, etc).
mrtksn
I get that but just because they use licensed IP doesn't mean that they have to sell it to the USA.
>And it's individual nation states (in this case Netherlands) that makes this decision, not the EU.
That's the current state of affairs, it doesn't have to be the same in the upcoming months or years because "decades are happening in weeks" lately. The sovereignty stuff is what kept EU from becoming like USA but things are on move now. Check the approval ratings and trust of Europeans about EU and their local government and you'll see that Europeans tend to trust EU much more than the national government. EU is actually very popular with the general public, its the far-right and the far left that demonize it(they see it as an obstacle towards libertarian utopia or communism).
Also, what if they just don't care about the license or replace the licensed IP with something from Korea/Japan? What if they just clandestinely sell those to China?
alephnerd
> I get that but just because they use licensed IP doesn't mean that they have to sell it to the USA
If ASML loses access to the IP they cannot sell it in any market that respects IP laws, nor can it raise capital as it now has extremely legal liability. And if the Netherlands is ready to tear up it's IP laws, it's going to be de facto sanctioned by the US and the rest of the EU, because IP Law is one of the few things European nation states devolved to the EU.
Also, around 20% of ASML's headcount is in the US, and much of that is R&D and manufacturing specifically for EUV Lithography.
> The sovereignty stuff is what kept from EU becoming like USA but things are on move now. Check the approval ratings and trust of Europeans about EU and their local government and you'll see that Europeans tend to trust EU much more than the national government
The EU has a better reputation amongst the population, yet at the end of the day, no actual power aside from single market and norms alignment has been devolved to the EU.
As I have mentioned multiple times at this point, politicans and businesses do not want to reduce their power by handing it to the EU. It might be good for the EU member states at a macro level, but it creates a lot of losers at the national level. And those losers can vote for the AfD, RN, etc.
For example, for a unified European army, either France, Germany, or Sweden is going to have to sacrifice their aerospace giants because Dassault, Eurofighter, and Saab compete directly and ferociously, and always undercut each other. And for tanks, Germany has to either sacrifice the entire chain for Leopold or France has to sacrifice the entire chain for Leclerc.
All of these are tens of thousands of jobs in France, Germany, and Sweden, and no party wants to become toxic for a generation by become the party that sacrificed their voters with mass layoffs for the benefit of the EU as a whole.
Individual European nation states need to align, and they just are not because Defense, Foreign Relations, and Internal Security has always been the mandate of individual states.
> That's the current state of affairs, it doesn't have to be the same in the upcoming months or years because "decades are happening in weeks" lately
It definetly is, but not in a good way. The major EU states had an emergency conference after Vance's horrid comments at MSC to try and align on a boots on the ground policy in Ukraine, but it was shot down by Poland and Germany [0]
[0] - https://www.politico.eu/article/europes-leader-donald-trump-...
MangoCoffee
>What happens if the EU-USA relationship deteriorates to the point that EU doesn't sell lithography machines and other equipment to the US, doesn't accept imports made with chips from USA and requires these things be made in China, Korea or Japan?
It has been posted here many times that the US started the EUV LLC to research EUV and allowed ASML to join. ASML doesn't hold all the cards. I doubt Americans are stupid enough to let ASML walk away with all the EUV IPs.
mrtksn
But this is not a card game, they can just build and ship these machines. IP and licenses are made up stuff to facilitate certain business transactions. You can just disregard those if you no longer care about those business ties. What USA will do? Send China DMCA complaint to tear down their ASML machines?
alephnerd
> What USA will do
In this unrealistic worst case, shut down the ability for ASML to raise any sort of capital by litigating in just about every market, threaten $60B in Dutch exports to the US, and threaten felony status for much of ASML, Philips, and NXP's leadership. Oh and nationalize Cymer LLC, as the manufacturing and IP for ASML's EUV work is in ASML's US Subsidary (Cymer llc [0]), not the Dutch parent that's a spinoff of NXP and Philips
[0] - https://www.cymer.com/
marcosdumay
At some point, we start to talk about military action.
It's not clear where the current US government will draw the line, and they would be crazy to draw the line at IP licensing... but well, I have some bad news.
I have absolutely no idea what is the Trump's (or Musk's, or whoever is calling the shots) endgame is. There is the chance that military action is inevitable. It's really bad either way.
dtquad
One thing that will make the re-industrialization of the West fail is if it turns into a rural/flyover state development program.
Chinese manufacturing is efficient because of the tight supply chain integration and centralization that has emerged in the big cities of the Pearl River Delta Area.
The decades old dream to manufacture cutting edge chips in Europe has also repeatedly failed because it keeps being turned into job development programs in Eastern Germany.
addicted
Yup. The problem with democracies in the West is that they keep trying to make unsustainable places sustainable.
China essentially says “here’s where all the talent is and where the talent is willing to move to…let’s focus there”.
Because of policy reasons Texas, for example, has been able to kind of grow, but it would be much better if the likes of California and New York fixed their bad policies so they could grow instead, as the potential is much greater.
gtirloni
The ghost towns in China disagree.
jrsj
The delays have nothing to do with it being in Ohio, and the CHIPS Act didn’t dictate where these would be built. Intel picked the site, just like TSMC and others picked theirs. Cost of land, energy, labor, etc all taken into account. The “flyover” states are the more cost effective place to do these things.
With Ohio specifically it’s being built just outside of a city too. Yes, we have those here. It’s actually not just one big state of a bunch of rural hicks demanding handouts from the government.
linwangg
This delay makes me wonder if Intel is struggling more than we think. With TSMC expanding in Arizona (despite their own delays), and Nvidia dominating the AI chip market, can Intel afford to push back its U.S. expansion? If the CHIPS Act incentives aren't enough to keep them on schedule, what's the real bottleneck—funding, demand, or execution?
alephnerd
Intel is mulling a breakup of the Foundry BU from the Chip Design BU and selling both to outside bidders [0]
A $28B liability would destroy the ability for any buyer to acquire the Foundry IDM portion of the breakup.
[0] - https://www.wsj.com/tech/broadcom-tsmc-eye-possible-intel-de...
gfkclzhzo
This might be a response to the functional repeal of the CHIPS act.
https://www.techspot.com/news/106925-chips-act-likely-fizzle...
Congressional appropriations don't matter when the president can fire staff and stop payments.
a2tech
Trump is messing with the chips act. It’s safe to say that anything that was operating under it is on pause.
snailmailstare
Carrot or stick might be all the same to TSMC, but Intel shouldn't have such a huge amount of its fab capacity within hotel tariff.
meltyness
It's a bad news on Friday kind of economy out there.
amelius
Makes sense to wait out this administration.
zulban
People said that in 2016, and 2020 too. These are the administrations the USA elects, that is permanent.
EcommerceFlow
Stop funding these broken and dying companies with grants, they need to die off
null
api
Why is TSMC operational already while Intel is stuck with a failing timeline?
Is Intel really that far out of it? I guess that’s what a decade plus of near monopoly dominance does to you.
kragen
People in the US really have a hard time hearing this:
It's probably because TSMC is in China. They're across the straits from the world center of the electronics industry, instead of across the Pacific, and they can hire the sort of people who pay private tutors for their kids instead of the sort of people who refuse to wear facemasks in a pandemic of a deadly respiratory infection. TSMC executives in Arizona have been consistently amazed at the laziness and ignorance of the workforce there.
60 years ago the US had the human capital and industrial base to found Intel. Now it probably doesn't have the human capital and industrial base to sustain it.
iszomer
TSMC is based out of Taiwan; China is West Taiwan. /joke
The narrative on "people who refuse to wear facemasks.." needs to be diffused if not wearing them for other reasons, eg: lessening the impact of particulate air pollution while commuting on a moped or, manufacturing not adequately maintaining their HEPA air filters during the "burn-in" test flow of server racks with fans pegged at 100%, 24/7.
Speaking of diffusion, what's with some of boxed retail processors with laser engravings on the heat spreader as being "Diffused in China"? Oh right -- TSMC and other foundries are not responsible for the entire chip manufacturing cycle.
kragen
"Diffused in China" chips are probably packaged in Malaysia.
api
I meant TSMC in Arizona, and the company is based in Taiwan.
I was alluding to this likely being a management problem at Intel.
kragen
Yes, as I said, the company is based in China. Maybe you're trying to say Taiwan isn't in China because it isn't governed by the CPC, which makes as much sense as saying Switzerland isn't in Europe because it isn't part of the EU. Even if it were correct, it's irrelevant to the advantages I'm talking about.
TSMC in Arizona is implementing fabrication processes brought to production readiness by the hard work and expertise of people at TSMC in China, which can draw on the whole Chinese electronics ecosystem that doesn't exist in the US anymore.
jrsj
I don’t know what news you’ve all been reading, but I don’t see anything about Trump cancelling the CHIPS Act. The 2 main things I’ve seen is trying to get TSMC to take over Intels manufacturing, and wanting to remove things like union labor requirements from the CHIPS Act.
jmclnx
It has been in the news that Trump did or about to cancel Biden's Chips act. So without those funds there is no incentive for Intel to build the fab, especially with how unstable this admin is when it comes to policies. You do not know what will happen one day to the next.
I am sure we will see more of this, I thought I saw the company in Taiwan (forgot the name) is scaling down or maybe cancelling their fab in AZ. Probably for the same "real" reason as Intel.
So will Intel need to return some of the 7.9 billion in federal grants as a result of this delay? It looks like 1.5 billion of that was already awarded as recently as last November.
https://www.industryweek.com/semiconductors/article/55246295...
https://www.news5cleveland.com/news/politics/ohio-politics/o...