Funding under the US CHIPS Act will now be overseen by a new Investment Accelerator office pushing companies to make “large investments” in the US, leaving the future of the billion-dollar program more uncertain than ever.

Just a few weeks after the US President expressed a desire to scrap the CHIPS Act altogether, Trump signed an executive order putting the act’s funding program under the new office of the Department of Commerce.

The office will negotiate “much better CHIPS Act deals than the previous Administration” the White House said, adding fuel to the uncertainty fire after reports Commerce Secretary Howard Lutnick is looking at pulling approved grants for manufacturers who don’t increase US spending.

Conceived in 2020 during Trump’s first term in office and introduced into law under the Biden Administration in 2022, the CHIPS and Science Act signposted $52 billion in federal grants and tax incentives for the industry to revitalise US-based chip production and research projects - as long as the beneficiaries didn't do things like invest in China.

It appeared to work, encouraging $450 billion in private investment according to the Semiconductor Industry Association, with $34 billion of the act’s funding allocated to companies, though only $4 billion has actually been disbursed due to cash being contingent on projects reaching certain milestones.

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While Trump’s criticism has manufacturers uneasy, for example North Carolina’s Wolfspeed poured doubt on its expectations of receiving a Biden approved $750 million grant, a tax credit expansion reportedly proposed by Lutnick as an alternative incentive could prove to be popular.

The administration is hoping that it can find other ways to encourage investment in the US industry away from direct grants, following from last month’s announcement that previous CHIPS Act grant winner TSMC would invest a further $100 billion in the US, investment Trump claimed was driven by his tariff threats.

While it seems unlikely the president would be able to completely dismantle the bipartisan legislation, his executive order will likely further limit the program office's ability to hand out funding after a third of its staff was let go last month.

The news comes as recent comments from Intel’s new CEO provided insight into the state of the US semiconductor industry as Lip-Bu Tan outlined his plan to get the US manufacturer back on top after losing out in recent years to competition from NVIDIA and AMD.

Despite being the largest beneficiary of the CHIPS act thanks to an $8.5 billion deal last year, Intel has struggled to capitalise on the need for chips for the AI era and will now spin-off non-core assets to focus on its primary businesses, the CEO said.

Speaking at Intel’s Vision event in Las Vegas, just three weeks after taking the role, Lip-Bu Tan revealed a renewed focus on engineer hiring, new products such as custom semiconductors, and giving staff “freedom to innovate” to pull the company out of its slump.

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