President Donald Trump is looking to increase the federal government’s stake in chip manufacturers that receive funding from the CHIPS Act.
U.S. Commerce Secretary Howard Lutnick is looking into the federal government taking equity stakes in computer chip manufacturers that receive CHIPS Act funding to build factories in the country, two sources said.
This comes amid reports that Trump intends to receive a 10% stake in chipmaker Intel.
White House press secretary Karoline Leavitt confirmed on Tuesday that Lutnick was working on a deal with Intel to take a 10% government stake. “The president wants to put America’s needs first, both from a national security and economic perspective, and it’s a creative idea that has never been done before,” she told reporters.
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The two sources said Treasury Secretary Scott Bessent is also involved in the CHIPS Act discussions, but that Lutnick is driving the process.
The CHIPS Act, officially known as the Creating Helpful Incentives to Produce Semiconductors Act, is a U.S. law passed in 2022 to strengthen domestic semiconductor manufacturing. It provides billions of dollars in funding and tax incentives to encourage companies to build and expand chip production facilities within the United States. The goal is to reduce dependence on foreign suppliers, especially amid global chip shortages that have disrupted industries like electronics, automotive, and defense.
By investing in research, development, and manufacturing of advanced semiconductors, the CHIPS Act aims to boost innovation, create high-tech jobs, and enhance national security. The Act supports building new factories and improving supply chain resilience to ensure the U.S. remains competitive in the critical semiconductor industry.
This year, Trump has taken decisive steps to strengthen the U.S. semiconductor industry by focusing on boosting domestic manufacturing and reducing dependence on foreign suppliers. His administration is exploring converting CHIPS Act grants into non-voting equity stakes in major chipmakers like Intel, aiming to secure taxpayer returns while enhancing national security.
Additionally, Trump proposed imposing a 100% tariff on imported semiconductors, with exemptions for companies that invest in expanding U.S.-based production. These measures have encouraged significant investments from industry leaders such as TSMC, which committed $165 billion to U.S. operations, and Nvidia, planning to produce $500 billion worth of AI infrastructure domestically over the next four years.
While some of these tariff policies have faced legal challenges, the administration remains committed to revitalizing the U.S. semiconductor sector through strategic incentives and protective trade measures. This approach reflects a broader push to insulate the American tech supply chain and foster innovation on home soil.