The U.S. Department of Commerce signed preliminary terms with SK Hynix to fortify the U.S. AI supply chain, enhance security, and advance semiconductor technology.
On Tuesday, the Biden-Harris Administration announced that the U.S. Department of Commerce and SK Hynix have signed a non-binding preliminary memorandum of terms (PMT) to provide up to $450 million in proposed federal incentives under the CHIPS and Science Act.
This substantial investment is set to establish an advanced packaging plant and research and development facility for artificial intelligence products in Indiana.
In addition to SK Hynix’s previous investment of approximately $3.87 billion in West Lafayette, Indiana, the proposed CHIPS investment is expected to create approximately 1,000 new jobs, offering a promising boost to the U.S. semiconductor supply chain.
The department has earmarked $500 million in government loans for the project, which is expected to qualify for a 25% investment tax credit.
Commerce Secretary Gina Raimondo announced that the department has finalised agreements with 15 companies to provide around $30 billion in funding. This move will attract an additional $300 billion in private investment.
Raimondo highlighted that this investment will make the U.S. supply chain for advanced semiconductors, crucial for artificial intelligence, the most secure and diverse in the world. She emphasised that no other country has more than two companies producing cutting-edge chips domestically, ensuring a strong and resilient industry for the future.
