"Investment Scale May Shrink" Why Did Intel Postpone the Groundbreaking Ceremony for Its Ohio Plant?

Pat Gelsinger, Intel Chief Executive Officer (CEO)
[Image source=Reuters News Agency]

[Asia Economy Reporter Jeong Hyunjin] U.S. semiconductor company Intel has postponed the groundbreaking ceremony for its planned Ohio factory. Rather than issues with the factory construction itself, this move is intended to pressure the U.S. Congress, which has yet to pass the CHIPS Act. Intel warned that if the support bill is not passed, the scale of the factory investment could be affected.

According to Bloomberg and The Wall Street Journal (WSJ) on the 23rd (local time), Intel informed Ohio Governor Mike DeWine and members of the Ohio state legislature that it would postpone the groundbreaking ceremony originally scheduled for the previous day, citing "uncertainty related to the semiconductor support bill" as the reason.

Intel stated that the Ohio factory construction plan is still ongoing and that the delay in the groundbreaking does not mean a postponement of the project timeline. As announced in January, Intel plans to begin construction by the end of this year and start mass production in 2025, with a minimum investment of $20 billion (approximately 26 trillion KRW). At the time of the January announcement, Intel said the Ohio project could expand up to $100 billion in scale, depending on the progress of the semiconductor support bill.

Intel added, "Unfortunately, industry support under the CHIPS Act is coming later than we expected, and we are uncertain whether we will receive this support." The company emphasized that if Congress takes action, Intel could accelerate and expand the scale of its Ohio and other U.S. projects.

Intel CEO Pat Gelsinger urged Congress to pass the bill before its August recess. In an interview with Bloomberg that day, he said, "Putting jokes aside, it is time to focus on the core issues and make a decision within the next two weeks." He added, "I believe both parties (Republicans and Democrats) and both chambers (Senate and House) feel the urgency to pass this before the August recess."

CEO Gelsinger stressed, "Whether we proceed slowly and modestly or go big and strong depends on the CHIPS Act. We have committed to building two factories, but I want to build eight or ten there." He emphasized, "I want this to be the largest manufacturing base and the best technology hub in the world."

Intel's Ohio project has been cited by U.S. President Joe Biden as a representative example of American manufacturing revival. Bloomberg also reported that during Gelsinger's interview, a senior White House official called expressing concern that Intel might reduce its investment scale.