Trump revisiting financial aid compliments from the Chips Act under Biden, as reported by Lutnick.
Washington Whirlwind:
Trump Administration Takes Aim at Semiconductor Grants
Brace yourself, folks! President Donald Trump's team is shaking things up by renegotiating some of the semiconductor grants doled out by former President Joe Biden's administration. Emergency room style, Howard Lutnick, the U.S. Commerce Secretary, confirmed during a hearing this week that some awards might not make the cut.
"We've been snooping around these grants, and honey, some of them, well, they seemed a mite too generous," Lutnick told lawmakers on the Senate Appropriations Committee. "We're aiming to make these deals shine brighter for our dear taxpayers."
He continued, "The goal here is clear—it's 'give the people what they desire,' and that's it." Intriguingly, Lutnick hinted that not every grant handed out during the Biden era would weather the renegotiations intact, saying, "All the deals in the mix are bubbling up better, but hey, a few naughty deals never should've graced the scene in the first place."
In 2022, Biden signed the CHIPS and Science Act, hoping to unleash $52.7 billion in cash on the U.S. semiconductor industry, aimed at growing manufacturing, research, and coaxing chipmakers away from their Asian haven. The plan showered grants on big-time chip heavyweights like Taiwan's TSMC, South Korea's Samsung and SK Hynix, as well as U.S.-based Intel and Micron.
With Biden's exit, the grants were just about to hit the sidewalk, though details about these deals remain tightly under wraps. The funds are intended to flow as companies progress in their promised plant expansion plans.
More Mag Wiggle Room
TSMC servin' as a role model, Lutnick highlighted how successful this renegotiation thingy can be. The chip titan scooped up $6 billion from the Chips Act, and in a flash of Maverick spirit, upped its initial investment pledge by $100 billion to a whopping $65 billion in U.S. manufacturing!
"Bingo!" boasted Lutnick. "We've flexed our negotiation muscles and managed to make that same ole $6bn do the trick." But, quiet as a mouse, it's unclear if the extra $100 billion was tied to the Chips Act agreement—TSMC ain't speaking, so we'll have to wait and see.
In February, our website revealed that the White House looked to reconsider some of these deals and had hinted at delays in some semiconductor grant disbursements.
And oh, by the way, when it comes to AI computing, the current administration is setting its sights on having more than half a cent are AI capacity right here in the U.S., quelling concerns that deals like the one Trump struck with the United Arab Emirates to hawk advanced AI chips could deprive the U.S. of crucial computing power. Game. Set. Match.
- The renegotiations initiated by the Trump Administration on semiconductor grants, initially awarded during the Biden administration, is not exclusive to the financial aspect of these deals, but also involves industry policy and legislation, given the political implications of such decisions.
- As the Trump Administration renegotiates some semiconductor grants and general news circulates about potential adjustments in the planned disbursement of funds, it is crucial for the industry to keep a close watch on policy-and-legislation developments and the broader political landscape to anticipate the impact on their respective businesses.