MCHP - U.S. awards Microchip Technology $162M to boost chip production

2024-01-04 05:26:22 ET

The Biden administration has awarded $162M to Microchip Technology ( NASDAQ: MCHP ) to support the domestic production of semiconductors.

The grant provides Microchip ( MCHP ) with $90M to improve a plant in Colorado Springs, Colorado and another $72M to expand a factory in Gresham, Oregon. The investments would enable the chipmaker to triple its domestic production, while reducing reliance on foreign factories.

Majority of the investment will support the making of microcontrollers, which find utility in the military, autos, household appliances and medical devices sectors.

Lael Brainard, director of the White House National Economic Council, said in a statement: "The chips and microcontroller units (MCUs) that Microchip fabricates are essential components in a wide range of consumer and defense products that are critical to American manufacturing, including electric which is only a fraction of the additional private investment that Microchip is making in these projects supply chain that impacts millions of American consumers and businesses."

This marks the second funding announcement tied to the CHIPS & Science Act which is aimed at boosting the development and manufacturing of semiconductors in the U.S.

The first grant of $35M was awarded to defense and aerospace company BAE Systems ( OTCPK:BAESY ), which plans to expand a New Hampshire factory producing chips for military aircraft, including F-15 and F-35 jets.

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