Intel delays groundbreaking ceremony for New Albany factories as it calls for more federal aid

Intel is delaying the July groundbreaking ceremony for its $20 billion project in New Albany, a symbolic move meant to express the semiconductor company's continued frustration over congressional inaction on a $52 billion aid bill for the industry.

The Silicon Valley company, in a statement released Thursday, expressed thanks to state officials for their support for what is Ohio's biggest economic development project, but warned again that if Congress doesn't act fast on what is dubbed the CHIPS Act it will hinder the Ohio project.

The House and Senate have each passed their own version of the legislation that would provide aid to the industry but have been slow to resolve differences as Intel and the Biden administration have repeatedly pushed Congress to finish its work.

“We are excited to begin construction on a new leading-edge semiconductor manufacturing plant in Ohio and grateful for the support of Governor (Mike) DeWine, the state government and all our partners in Ohio. As we said in our January announcement, the scope and pace of our expansion in Ohio will depend heavily on funding from the CHIPS Act,” the company said in its Thursday statement.

“Unfortunately, CHIPS Act funding has moved more slowly than we expected and we still don’t know when it will get done. It is time for Congress to act so we can move forward at the speed and scale we have long envisioned for Ohio and our other projects to help restore U.S. semiconductor manufacturing leadership and build a more resilient semiconductor supply chain."

Intel's statement was interpreted by some news outlets and by U.S. Rep Tim Ryan, D-Niles, to mean that Intel was delaying the start of the New Albany project.

"Every day we waste by not passing the CHIPS Act funding is another day we fall further behind in our competition with China," Ryan said in a Thursday press release. "This partisan gridlock has now caused a delay of a $20 billion economic shot in the arm for Ohio."

Intel said Thursday that work is continuing as planned for the New Albany factories but confirmed that it plans to delay the July 22 ground-breaking ceremony.

Intel plans to build build two factories, called fabs, in New Albany. The factories will employ 3,000 workers with an average wage of $135,000. There also will be 7,000 construction workers.

It has said the project ultimately could include eight factories with a total investment approaching $100 billion, making it potentially the biggest semiconductor manufacturing site on Earth.

Lt. Gov. Jon Husted said Friday Congress needs to move on the legislation.

"China and the European Union have acted, but America has dithered," he said. "Every semiconductor company is pausing, (and asking) where do I want to make my investment — in the EU, Asia or America."

As he has said before, Husted said it is vital to bring production of these devices, which power everything from cell phones to computers to cars to military equipment, back to the U.S.

The U.S. once produced 37% of the world's computer chips, but that has fallen to 12%. Much of the production has shifted to Asian countries with the help of big subsidies from their governments, and that's why backers of the CHIPS Act say federal support is necessary.

"If they don’t act soon, corporate investment is going to go to Europe and Asia and not America," Husted said. "That’s not going to change the first phase of what intel is going to do.’’ 

mawilliams@dispatch.com

@BizMarkWilliams