The Biden administration on Thursday announced it is providing $162 million to Microchip Technology, a move it says will bolster domestic production of computer chips and create jobs. 

What You Need To Know

  • The Biden administration on Thursday announced it is providing $162 million to Microchip Technology from the CHIPS and Science Act, a bipartisan law which aims to bolster domestic semiconductor production
  • The funding is expected to bolster domestic production of computer chips and create jobs, the Commerce Department said 
  • The money will go toward a plant in Colorado and a factory in Oregon and is expected to allow the company to nearly triple production at the sites as well as create 700 jobs

The funding marks the second round of money to be awarded under a 2022 law, the CHIPS and Science Act, which seeks to revive semiconductor manufacturing in the U.S. Biden often touts the bill, which earned bipartisan support, as one of his key legislative accomplishments. 

The Commerce Department noted $90 million of the funding announced Thursday will go toward improving a facility in Colorado Springs, Colorado while $72 million will be used to expand a factory in Gresham, Oregon. 

The expansions and upgrades will allow Microchip Technology to nearly triple its output of semiconductors produced at these locations, thus reducing its dependence on foreign factories, according to the department. Production at the company, based in Arizona, supplies a range of industries, including automotive, aerospace and defense. 

“This manufacturing investment in Oregon and Colorado will advance the President’s goal of making semiconductors in America again and reducing reliance on global supply chains that led to price spikes and long wait lines for everything from autos to washing machines during the pandemic,” White House National Economic Advisor Lael Brainard said in a statement. 

The new funding is also expected to facilitate the creation of more than 700 direct construction and manufacturing jobs.

“With this proposed investment, President Biden is delivering on his promise to rebuild America’s semiconductor supply chain, creating a more secure defense industrial base, lower prices for Americans, and over 700 jobs across Colorado and Oregon,” Secretary of Commerce Gina Raimondo said in a statement. 

Brainard also made the case that the funding would help to tame inflation – an issue that has plagued Biden’s economic approval ratings despite falling significantly from its peak. 

"Semiconductors are the key input in so many goods that are vital to our economy,” she said, adding that greater U.S. production of chips would have reduced the supply problems that caused the cost of autos and washing machines, among other goods, to rise as the country emerged from the coronavirus pandemic in 2021.

Biden signed the CHIPS and Science Act in August 2022 and the Commerce Department said it expects more funding announcements this year. 

In December, the Commerce Department announced the first grants by saying it reached an agreement to provide $35 million to BAE Systems, which plans to expand a New Hampshire factory making chips for military aircraft, including F-15 and F-35 jets.

The Associated Press contributed to this report