The U.S. government is in talks to get a 10% equity stake in Intel.
The U.S. government could get a 10% equity stake in Intel in exchange for more funds from the CHIPS Act, according to Commerce Secretary Howard Lutnick, who appeared on CNBC Tuesday. Lutnick was pressed about whether that would be a worse deal than what Intel had previously received under the Biden-era manufacturing plan, and the commerce secretary seemed more than happy to acknowledge it was.
“Of course it’s worse, of course it’s worse…” Lutnick said, laughing. CNBC host David Faber asked if that made it difficult for U.S.-based tech giant Intel to actually compete against companies like Taiwan-based TSMC—a concern because chip manufacturers overseas are eating Intel’s lunch. But Lutnick didn’t buy the argument.
“The CHIPS Act was just a giveaway to rich companies,” Lutnick said. “I mean, why in the world is the United States of America taking money and giving it to companies like TSMC, which is worth a trillion dollars? I mean, why would we give them money to come to America?”
The CHIPS Act passed with bipartisan support in 2022 and allocated $39 billion for subsidies in an effort to spur chip manufacturing in the U.S. and better compete with China. TSMC received $6.6 billion in grants to expand chip production in the U.S. under the law, while Intel has received about $7.9 billion, according to CNBC. Intel has struggled in recent years, announcing plans last month to lay off about 15% of its staff and dramatically slowing its expansion, which means much of the money it has available hasn’t been handed over yet under the terms of the legislation.
Lutnick insisted that Trump has secured better deals with technology companies, while Biden has been just handing out money without getting more for the U.
