Micron to Invest Up to $100 Billion in US, Credits CHIPS Act

Micron to Invest Up to $100 Billion in US, Credits CHIPS Act

Micron Technology announced Tuesday that it plans to spend $20 billion to build a state-of-the-art semiconductor production complex in upstate New York, part of a domestic manufacturing effort that could see the company investing as much as $100 billion in the area over two decades.

At a press conference held at Syracuse University, near the proposed building site in Clay, New York, Micron CEO Sanjay Mehrotra told reporters that the company chose the location for the depth of the local labor pool, the quality of schools in the area, access to clean water – and, not least, the extraordinary financial incentives provided by local, state and federal governments.

In addition to $5.5 billion in state and local tax credits, Boise, Idaho-based Micron expects to claim a share of the $52 billion in incentives made available by the federal government through the CHIPS and Science Act of 2022, which President Joe Biden signed into law last summer to encourage domestic semiconductor production and investment in scientific research and development more broadly.

“There is no doubt that without the CHIPS Act, we would not be here today,” Mehrotra said. “The legislation along with favorable tax treatment and partnerships with state governments like New York are key ingredients needed to match the subsidies offered by Asian nations and ‘bring chip-making back to America.’”

The first phase of the project will involve spending $20 billion to build a plant, known as a mega-fab, that will employ 3,000 people once it’s up and running. Site preparation is expected to begin in 2023, with construction starting in 2024 and the factory coming online in 2025.

If the company decides to expand the facility, it could end up building a complex of four factories employing 9,000 people, at a total cost of roughly $100 billion.

The politics of development: The White House celebrated Micron’s announcement, linking it to the president’s legislative efforts. “To those who doubted that America could dominate the industries of the future, I say this – you should never bet against the American people,” Biden said in a prepared statement. “Today is another win for America, and another massive new investment in America spurred by my economic plan.”

New York Gov. Kathy Hochul also highlighted the announcement. “New York will be home to one of the largest economic development projects in American history,” she said on social media. “The state’s largest-ever manufacturing project, @MicronTech is investing $100 billion over 20 years in a semiconductor manufacturing campus that will create nearly 50,000 jobs.”

Senate Majority Leader Chuck Schumer (D-NY), who has advocated for U.S.-based tech manufacturing, with his home state playing a leading role, said that passing the CHIPS Act played a key role in securing the deal. “Had America not done that, I think our economy would have slipped,” Schumer told The New York Times. “We’ve led in semiconductor research, but over the years we let the manufacturing slip away. But we’re reversing that now.”

In separate comments to The Washington Post, Schumer paid tribute to the “transformational” nature of the deal. “This is our Erie Canal moment. Just as the Erie Canal fueled explosive job growth and prosperity in the 19th century, so will these investments fuel explosive job growth and prosperity in the 21st century.”