Intel To Build Hush-hush Fabs To Bake Chips For US Military

Intel looks set to be a key beneficiary of CHIPS Act funding earmarked for specifically supplying the US military.

The Santa Clara giant is already in line to receive a substantial amount from the Biden administration's pot of CHIPS Act cash, potentially amounting to $17.5 billion for the x86 goliath in subsidies and loans to boost domestic silicon production.

According to the Wall Street Journal, Intel is now the leading candidate to receive billions more from the government for facilities to manufacture chips for US military and intelligence applications.

The facilities are to be designated as a "secure enclave", indicating that chips for the military might be made on a separate production line with restricted access. Part of this might be constructed at Intel's Arizona campus, which the chipmaker already has plans to expand.

It is reported the facilities could cost $3 billion to $4 billion, with the money coming from the $39 billion of manufacturing grants authorized under the CHIPS Act.

The purpose is to give exclusive access to processors and other advanced chips that US military needs for modern weapons systems, and also to address US government concerns that America is too dependent on cutting edge semiconductors produced in Asia, particularly Taiwan, which is seen as being vulnerable to invasion by China.

Details of this scheme have yet to be disclosed publicly as officials from various Washington departments, such as the Department of Commerce and the Department of Defense, are still negotiating the project with Intel.

We asked Intel if it could confirm any of these details, but the company had not responded at the time of publication.

The CHIPS Act was signed into law by US president Biden last year, making available $53 billion to boost America's chip industry, $39 billion of which is aimed at semiconductor incentives, $13.2 billion for R&D and workforce development, and $500 million to strengthen global supply chains.

Intel chief Pat Gelsinger previously said that his company deserved a larger share of the CHIPS Act funding, as it conducts R&D in the US as well as manufacturing.

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Intel also announced the delivery of prototype multi-die chips it was commissioned to build for the US Department of Defense back in April this year.

The Department of Defense has already announced some investments as part of the CHIPS Act funds, such as $238 million that is going into 8 Microelectronics Commons regional innovation hubs.

Meanwhile, the Department of Commerce last month disclosed the designation of 31 regional tech hubs across the US to drive regional innovation and job creation, also using an initial $500 million funding from the CHIPS Act. ®