Trump renegotiating Biden-era Chips Act grants, Lutnick says
The Trump administration is renegotiating some of former President Joe Biden's grants to semiconductor firms, with an official suggesting some awards may be axed. PHOTO: REUTERS
WASHINGTON - US President Donald Trump's administration is renegotiating some of former President Joe Biden's grants to semiconductor firms, US Commerce Secretary Howard Lutnick said at a hearing on June 4, suggesting some awards may be axed.
Some of the Biden-era grants 'just seemed overly generous, and we've been able to renegotiate them,' Mr Lutnick told lawmakers on the Senate Appropriations Committee, adding the goal was to benefit American taxpayers.
'All the deals are getting better, and the only deals that are not getting done are deals that should have never been done in the first place,' Mr Lutnick said, appearing to signal that not all the awards would survive renegotiation.
Mr Biden in 2022 signed the Chips and Science Act to plow US$52.7 billion (S$67.81 billion) into boosting semiconductor chips manufacturing and research in the US and luring chipmakers away from Asia.
The programme rolled out billions in grants for semiconductor heavyweights including Taiwan's TSMC, South Korea's Samsung and SK Hynix, as well as US-based Intel and Micron.
The grants, while signed, had only just begun to be disbursed by the time Mr Biden left office.
The details of those plans are not public, but the money is meant to be disbursed as companies make progress toward their pledged plant expansions.
More bang for the buck
Mr Lutnick pointed to TSMC as an example of successful renegotiation.
He said the chipmaker – which won a US$6 billion Chips Act award – had increased by US$100 billion its initial pledge to invest US$65 billion in US manufacturing.
'We were able to modify the award for the same US$6 billion of (government) funding,' he said.
TSMC announced the US$100 billion in added investment in March, but it was not immediately clear whether that was part of a renegotiation of its Chips Act award.
TSMC declined to comment.
Reuters reported in February that the White House was seeking to renegotiate the awards and had signalled delays to some upcoming semiconductor disbursements.
Mr Lutnick also said the administration agrees with the goal of having more than 50 per cent of global AI computing capacity in America, responding to concerns that deals like the one announced by Mr Trump in May to allow the United Arab Emirates to buy advanced American artificial intelligence chips could deprive the United States of key AI computing power. REUTERS
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