Micron will invest $100 billion to build a chip factory in New York state



CNN

Micron said Tuesday it would invest $100 billion over the next two decades to build a giant semiconductor factory in New York state. The move comes after efforts by the US government to boost domestic chip production.

The Idaho-based company said it plans to build “the largest semiconductor manufacturing facility in U.S. history” in Clay, New York. Micron said the new facility, about 15 miles from Syracuse, will create nearly 50,000 New York jobs over the next two decades.

The initial investment of 20 billion dollars is planned by the company “by the end of this decade”. Site preparation will begin in 2023, construction will begin in 2024 and production output will “increase in the latter half of the decade, gradually increasing in line with industry demand trends,” according to the company.

Shares of Micron rose nearly 5% on Tuesday after the news was announced.

In August, President Joe Biden signed into law the CHIPS and Science Act, which aimed to boost American chip manufacturing with an investment of more than $200 billion over the next five years. The package included about $52 trillion for chip manufacturing and research, providing incentives to companies to build, expand and modernize US facilities and equipment. The legislation was aimed at reducing U.S. dependence on offshore chip production in Asia, which came as a result of global shortages of these building blocks needed for smartphones, cars and computers.

In a statement Tuesday, Micron President and CEO Sanjay Mehrotra said he is “grateful to President Biden and his Administration for making CHIPS and the Science Act a priority.”

“This historic cutting-edge memory megafab in Central New York will deliver benefits beyond the semiconductor industry, strengthening US technological leadership and economic and national security, driving American innovation and competitiveness for decades to come,” added Mehrotra. (A fab refers to a semiconductor manufacturing plant).

The company said the $5.5 billion in New York State incentives over the life of the project, along with federal grants and tax credits provided under CHIPS and the Science Act, “are essential to support procurement and capital investment.”

New York Gov. Kathy Hochul hailed Micron’s investment in a statement, saying it “marks the beginning of a transformative scale and opportunity for our state’s economic future.” He added that this investment, which is the largest private sector investment in the state’s history, will help “lead the state into another Industrial Revolution.”

Getting new semiconductor factories up and running in the US can take years. Before the CHIPS legislation, Taiwan Semiconductor Manufacturing Company had committed at least $12 trillion to build a semiconductor manufacturing plant in Arizona, with production expected to begin in 2024.

Intel earlier this year announced plans to build a $20 billion semiconductor manufacturing plant in Ohio, but later warned that the project could be delayed unless lawmakers pass the CHIPS legislation. The groundbreaking for the new Intel chip plant took place last month. Biden traveled to Ohio to celebrate the event.