One of the most surprising news of the summer was the downturn of Intel, the leading American chip company. Unfortunately for the interests of the American firm, a series of bad decisions led to thousands of mass layoffs in addition to the poor performance of its latest processors. Therefore, the United States government has taken action and decided that it is time to help Intel.
As noted by TechSpot in a recent publication, the US government is encouraging companies like Apple and NVIDIA to use Intel’s chip manufacturing for AI production. In this way, Americans seek to reduce their dependency on TSMC, the Taiwanese semiconductor giant. Therefore, Intel’s CEO Pat Gelsinger has requested help from Gina Raimondo (Commerce Secretary) to persuade big companies to support manufacturing in the United States.
A considerable challenge for companies like NVIDIA
Unfortunately, although they have already met with investors to highlight the economic benefits of having a national chip manufacturing plant capable of producing AI chips, switching manufacturers will be a major challenge. For example, NVIDIA relies on the advanced capabilities of TSMC, which is why moving their operations to Intel would be a step back. Nonetheless, Intel is not giving up and is building new plants in four states in the US to strengthen its position as a chip design service provider for others.
According to the latest revision of the CHIPS and Sciences Act, the intention of the US government is to provide Intel with 11 billion euros along with an additional 8 billion euros in direct funding. Unfortunately, their efforts have not prevented delays in Intel’s manufacturing, and therefore, the company’s forecast is to recover from losses by 2027. However, they have already secured a powerful partner like Microsoft, and thus continue to pave their way to try to surpass TSMC in the coming years.
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