| | | I actually think it's a great deal for Intel, and a lousy deal for the government (if the interest is to make money).
If you could magically own 10% of any semiconductor firm would you choose Intel? No way.
It probably stops other semiconductor firms from wanting to receive Chips Act funds, if it requires them to sell (give?) equity to the US government. On the other hand, any semiconductor firm bidding for US government contracts probably would love to have the government as an investor, if it makes it more likely that they win the US government contracts.
From all I've read it doesn't quite seem that the US government fully understands the situation with the semiconductor industry, and what is and is not strategic. Probably they understand it, but the chaotic way that things are rolling out doesn't give one confidence.
The US dominates the world in semiconductor design, and semi design tools.
The US dominates the world in semiconductor capital equipment - the machines used to fabricate / manufacture semiconductors.
The US DOES NOT dominate the world in the fabrication of semiconductors. THAT's the national security issue. TSMC in Taiwan dominates the manufacturing / fabrication of semiconductors, especially at the leading edge. For some reason, this industry (taking a customer's design and making an actual semiconductor out of the design) is a winner takes all industry, and TSMC is winning, and no one can catch up. Intel is trying to catch up, but not succeeding.
So there are loads of ways to make TSMC stop advancing in semiconductor fabrication. For example, tell Applied, Lam and KLA Tencor to stop selling them capital equipment machines. Boom, TSMC is halted from advancing down the technology roadmap. But then our capital equipment industry suffers (badly) and the entire world suffers because chips don't advance.
Anyways, giving Intel $10 billion doesn't mean they can be a merchant fabricator that will be equal to TSMC. Not even close. Intel has no problem getting capital. It's not the capital required, it's the technological know how.
And, since Trump will be out of office in three more years, no semiconductor company is adjusting their long term (multi-decade) strategy to fit his unique economic views. I doubt the next Republican President does anything close to what Trump is doing in regard to tariffs and government control over areas they haven't traditionally had control, so why would a semiconductor company spend the $$ billions required to do what Trump wants, and then the next President perhaps could care less about this stuff, and the world may go back to the "highest quality at cheapest price anywhere in the world" system wins. |
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