According to reports, U.S. President Donald Trump is reevaluating funds issued under the outgoing Joe Biden administration's Chips and Science Act Therefore, the highest chipmaker this week is at the edge this week.
Two sources familiar with the matter told Reuters that the White House is seeking to renegotiate the rewards and pointed to some of the upcoming delays in semiconductor spending.
People and third sources said the new administration is reviewing projects granted under the 2022 law, aiming to boost domestic semiconductor output with $39 billion in subsidies.
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Asian chipmakers, Taiwan’s TSMC and South Korean chip giants Samsung Electronics and SK Hynix are among some of the biggest recipients of the Chip Act funding. Reconsideration of subsidies granted by companies will be a major setback in their ongoing work to build a semiconductor manufacturing plant (FABS).
Taiwan's GlobalWafers said it has not yet notified any changes to its rewards directly through Washington, and they will receive $406 million in U.S. government grants from Texas and Missouri programs. The company is currently only able to receive subsidies after achieving certain milestones later in 2025.
“The CHIPS Program Office tells us that certain conditions do not match the executive order and policies of President (Donald) Trump and that all chip direct funding agreements are currently being reviewed,” GlobalWafers spokesman Leah Peng said in response to Reuters said in a statement.
A TSMC spokesman said the company had received $1.5 billion in chip bill payments before coming in under the milestone terms of its agreement.
Taiwan's pressure
A TSMC spokesman also declined comments on any possible changes to the Trump-led agreement, but said the company will continue to interact with the CHIPS Program Office. Samsung and SK Hynix also declined to comment.
TSMC is the world's largest contract chip manufacturer, spending $65 billion in Arizona, building three factories, and has Some of the most advanced chips have begun In one of the facilities. Chip Manufacturer Has been promised a subsidy worth $6.6 billion For Arizona plants.
Taiwan chipmakers are under additional pressure, given Trump’s growing criticism of the island. Recently, Trump said Thursday that Taiwan has taken away the U.S. chip business and he hopes to return it.
In response, Taiwan's President Lai Guaranteed Friday Talk to the United States about Trump’s concerns, increase U.S. investment and buy more from the country, while also spending more.
Meanwhile, under the Chip Act, South Korea's largest chip maker, Samsung, will receive a $6.4 billion grant in lieu of building two factories in Texas. The company is investing $40 billion in these facilities.
Similarly, SK Hynix has pledged to directly fund $458 million and with its nearly $4 billion investment in Indiana, up to $500 million in loans.
Focus on basic terms
Each winner has different terms and milestones in its agreement.
Four sources of knowledge told Reuters that the White House was concerned about many provisions based on $39 billion in chips and scientific law industry subsidies.
These cover additional terms, including requirements in the contract added by the Biden administration, including the need for recipients to use union labor to build the factory and help provide affordable parenting for factory workers.
Sources said Washington plans to renegotiate some deals after evaluating and changing current requirements.
The extent of possible changes and how they will affect the already completed protocols are unclear. It is not clear whether any action has been taken.
China Investment under Scanner
One of the sources said the White House was also frustrated with companies that were receiving subsidies from the chip bill, and then announced a large number of overseas expansion plans, including China. The law allows some investment in China.
Intel, for example, announced a $300 million investment in Chinese parliament and testing facilities in October, and said in March that it received a major reward under the Chip Act.
Many of the largest recipients of the “Share Act” funding (including Intel, TSMC, Samsung and SK Hynix) have major manufacturing facilities in China.
- Reuters, other editors of Vishakha Saxena
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