The CHIPS and Science Act of 2022, which received wide bipartisan support, includes $52.7 billion to increase domestic semiconductor production

After initial setbacks with its earlier iteration, the CHIPS and Science Act of 2022 sailed through both chambers of Congress early this week. The bill, which held uncharacteristically broad bipartisan support, hit some unexpected roadblocks in its last 24 hours in Congress, but still managed a wide margin of victory at 64-33 in the Senate and 243-187 in the House. The bill was signed into law during an event on the White House’s South Lawn.

The President was joined by Speaker of the House Nancy Pelosi, Senate Majority Leader Chuck Schumer, Gina Raimondo and SparkCharge founder/CEO Joshua Aviv, who spoke about the impact of the act on his Syracuse-based electric vehicle start-up. “For years, my industry was at the mercy of the supply chain,” Aviv said, before explaining that the company manufactures its parts in Buffalo, New York. “This new law gives people like me a chance and allows us to grow our business.”

Biden noted,“Today is a day for builders. Today America is delivering,” before adding that the bill is “a once in a generation investment in America itself.” He went on to note that the country has gone from producing ~40% of semiconductors to less than 10%, due to rampant manufacturing outsources.

The final version of the act sets aside $52.7 billion for the research, development and domestic manufacturing of semiconductors; $39 billion of that goes toward incentivizing manufacturers, with $2 billion being used to create existing/legacy chips for automotive and defense — a shortage of the former has hamstrung carmakers unable to move unfinished vehicles. Another $13.2 billion will be invested in R&D and workforce development.

Last week, the president joined Michigan Governor Gretchen Whitmer virtually — canceling a planned trip to Hemlock township — home of Corning-owned Hemlock Semiconductor — after once again testing positive for COVID-19 over the weekend. Following remarks from Michigan Senators Debbie Stabenow and Gary Peters celebrating hopes for a return to domestic manufacturing, Whitmer signed an executive order focused on the act.

“It’s important for us to make things in America,” the governor said, before signing an executive directive. “We’re making a once in a century investment in industry and bringing the supply chain for China to Michigan.” The choice of location was clear, given Michigan has come to represent both the rise — and decline — of U.S.-based manufacturing as an epicenter for the auto industry. It also highlights how essential the semiconductor has become, across industries.