The Biden administration has agreed to set aside $162 million in CHIPS Act funding for Microchip Technology to promote the onshoring of semiconductor manufacturing and construction jobs.
On Thursday, the Department of Commerce entered into a non-binding preliminary memorandum of terms to enable the company to ramp up production of specialty semiconductors such as microcontroller units, according to the National Institute of Standards and Technology.
“This proposed investment and others like it will help ensure that U.S. companies have a stable supply of the critical chip components they need to keep their factories running,” said Laurie Locascio, NIST director and undersecretary of commerce for standards and technology.
Under the terms of the agreement, Microchip Technology will utilize the funds to expand and modernize its facilities in Colorado Springs, Colorado and Gresham, Oregon. The Colorado Springs fabrication site will receive an estimated $90 million, while the Gresham installation will be granted approximately $72 million.
The federal incentives are expected to triple the company’s output of semiconductors produced at these facilities, which are critical to the defense, automotive, aerospace and commerce sectors.
Last month, the White House announced its first PMT through a $35 million agreement with BAE Systems.