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Ohio lured Intel’s chip factory with $2 billion incentive package


Intel CEO Patrick Gelsinger, left, speaks with Ohio Governor Mike DeWine during the announcement Friday, Jan. 21, 2022, in Newark, Ohio, that Intel will invest $20 billion to build two computer chip factories on a 1,000-acre site in Licking County, Ohio, just east of Columbus. (AP Photo/Paul Vernon)


Ohio offered Intel Corp. incentives worth about $2 billion to secure a new $20 billion chip manufacturing plant that the company says will help ease a global shortage and create a new tech hub in the Midwest.

The state’s director of development said Friday the combination of tax breaks and incentives was likely the biggest ever offered by Ohio for what state leaders consider the biggest development deal ever. economics of its history.

Santa Clara, Calif.-based Intel, the world’s second-largest chipmaker, announced a week ago that it had selected a site outside of Columbus for two new chip manufacturing facilities.

The complex could grow much bigger and faster, Intel executives said, if Congress approves a $52 billion bill that would invest in the chip industry and help ensure more production in the United States. United.

Intel CEO Patrick Gelsinger said total investment in Ohio could exceed $100 billion over the decade, with six additional factories making it one of the largest manufacturing sites chips in the world.

Shortages of computer chips, which are mostly made in Asia and used in everything from handheld video games to automobiles, have become a growing concern and have come to light in the United States and Europe during the pandemic.

The United States’ share of the global chip manufacturing market has fallen from 37% in 1990 to 12% today, according to the Semiconductor Industry Association.

Intel wants to move quickly on factories in Ohio, which will support its own line of processors and build chips designed by other firms. Construction is expected to begin this year, with production commissioning in late 2025.

Ohio’s offer includes $600 million to help Intel offset the cost of building factories, which is more expensive than in Asia, said Lydia Mihalik, the state’s director of development.

The state will also pay nearly $700 million for road and water infrastructure upgrades, including a system that will allow the plant to reuse wastewater.

The state legislature this summer approved a 30-year tax break that will save Intel $650 million.

The state’s share will be money well spent as the Intel facility will not only create jobs but also make Ohio more attractive to industries such as automotive, aviation and defense which depend on chips, Mihalik said.

“These investments will not only ensure the success of this project here, but will also support the region by increasing local infrastructure to support future growth,” Mihalik said.

In addition, the state’s privatized economic development office, JobsOhio, will provide Intel up to $150 million in combined economic development and labor grants, said JobsOhio spokesman Matt Englehart. .

The two plants on a 1,000-acre site in Licking County, just east of Columbus, are expected to create 3,000 company jobs — many of them highly skilled — and 7,000 construction jobs. The facility will support tens of thousands of additional jobs for suppliers and partners, Intel and local and state officials said last week.

Ohio beat out 40 other states for the project, state officials said.