Enormous microchip manufacturing site heading to Ohio

COLUMBUS, Ohio—Intel Corp. is taking on the microchip crisis by increasing its U.S. production output with an enormous expansion project set to take shape in the Midwest.

The microchip producer said Jan. 21 it would build a $20 billion facility on a 926-acre site in Licking County, Ohio, near Columbus. The investment includes construction of two state-of-the-art factories for microchips that represent Intel's "most advanced process technologies."

Intel also pledged $100 million to establish and maintain partnerships with educational institutions in an effort to help build a "pipeline of talent and bolster research programs in the region."

Site planning is set to begin immediately with operations starting as early as 2025. However, the pace and scope of the project also will be determined by the amount of funding available through the CHIPs Act, according to Keyvan Esfarjani, Intel senior vice president of manufacturing, supply chain and operations.

"The impact of this mega-site investment will be profound," Esfarjani said of the company's Ohio investment. "A semiconductor factory is not like other factories. Building this semiconductor mega-site is akin to building a small city, which brings forth a vibrant community of supporting services and suppliers."

If passed, the CHIPs (Creating Helpful Incentives to Produce Semiconductors for America) Act would provide $52 billion in funding to help expand microchip production through expansion projects across the U.S.

Ohio Gov. Mike DeWine called Intel's latest investment "transformative," saying it represents the largest private investment ever made in Ohio.

DeWine estimates that the move will generate more than 20,000 jobs statewide, including the 3,000 jobs at the Intel facilities as well as construction, support jobs and contracted positions.

"Advanced manufacturing, research and development and talent are part of Ohio's DNA, and we are proud that chips—which power the future—will be made in Ohio, by Ohioans," DeWine said in a statement.

President Biden, likewise, praised the Intel investment during a White House ceremony announcing the move, saying that microchip technology is, at its core, American.

" 'Made in Ohio. Made in America.' It's what we used to always be able to say 25, 30 years ago. That's what this is about," Biden said in remarks Jan. 21. "… America invented these chips. And federal research and development led to the creation of these chips—taxpayer dollars. These chips helped power NASA's mission to the moon."

According to a news release issued by DeWine, the U.S. was the largest producer of microchips in 1990, owning 40 percent of the world's capacity. Today, the U.S. has just 12 percent of the world's microchip capacity, while Asia maintains the largest share.

That shift in manufacturing was exacerbated by the COVID-19 pandemic and its subsequent supply chain woes. What has resulted is a microchip shortage that has greatly impacted the automotive industry, among others. The shortage has been deemed a national security concern by top officials in the U.S. and Canada.

To this end, Biden urged passage of the chips bill.

"At the end of the day, this is about national security, economic security, and it's about jobs—good-paying, decent jobs you can raise a family on," Biden said. "Jobs. Jobs now. Jobs for the future. Jobs in every part of the country. Jobs that show—that bring the industrial Midwest back."

In addition to the automotive and mobility spaces, Intel's microchips are used throughout a number of sectors, including aerospace and aviation, consumer goods, data centers, defense, health care and technology.