For expanding facilities in Minnesota and Texas and boosting local employment, the Biden administration has sanctioned a total $99 million fund for three more companies under the CHIPS Act.
On Friday, the Biden administration announced new funding awards, totalling $99 million under the CHIPS and Science Act, aimed at supporting semiconductor facility expansions in Minnesota and Texas. According to the US Commerce Department, semiconductor firms Coherent, SkyWater Technology Foundry, and X-Fab will each receive financial assistance to modernise and expand their operations in these two states.
Both states have seen significant investments from the CHIPS Act in recent years. Minnesota has received $139 million for semiconductor projects, while Texas has garnered around $8.1 billion for similar initiatives from four different chip manufacturers.
Each of the three companies plans to apply for the advanced manufacturing investment credit, which covers 25% of qualified capital expenditures.
Coherent, a Pennsylvania, US-based company, is set to receive up to $33 million to enhance its facility in Sherman, Texas. This funding will aid the expansion of its 65,032.1 square-metre (700,000-square-foot) manufacturing plant, adding a new cleanroom and advanced wafer fabrication equipment.
This will also create 70 new jobs. The facility will focus on producing indium phosphide (InP) devices, which are used in various applications, including telecommunications, AI infrastructure, and medical devices.
SkyWater Technology Foundry, based in Bloomington, Minnesota, will receive $16 million to upgrade its production capabilities. The funding will help increase wafer production capacity by 30%, creating 70 new jobs again.
SkyWater is a key supplier for the US Department of Defence, providing trusted semiconductor manufacturing services. The company plans to invest $320 million in customer-funded capital expenditures through 2026, further expanding its operations. Additionally, the state of Minnesota will provide $19 million in additional funding to support the project.
X-Fab, operating a silicon carbide wafer foundry in Lubbock, Texas, will receive $50 million to expand its facility. This investment is expected to generate 150 new jobs and strengthen the supply chain for critical industries, such as the automotive and renewable energy sectors.
The expansion, which was first announced in 2023, will increase the factory’s capacity to meet growing demand, addressing the supply chain vulnerabilities that emerged during the COVID-19 pandemic. X-Fab, a Belgium-based company, operates additional wafer manufacturing sites in Germany, France, and Malaysia.
Since its inception, the CHIPS and Science Act has provided substantial funding to the semiconductor industry, with $16.9 billion in proposed funding for 19 companies and $16.3 billion in finalised awards to eight chipmakers. The rapid distribution of these funds is expected to continue as the new presidential term approaches.
