DoD bolsters domestic chip production through incentives

Going by the posting on a government contracting site, the U.S. Defense Department will soon commence soliciting proposals for a program to provide incentives to boost the production of chip in the country.

Currently large American chip companies, including Nvidia Corp, Apple Inc, and Qualcomm Inc outsource the fabrication of semiconductors to companies such as Taiwan Semiconductor Manufacturing Co Ltd (TSMC) or Samsung Electronics Co Ltd.

Most of chip foundries are located in South Korea or Taiwan. Intel Corp is the only U.S. U.S. chip maker which has factories in the U.S., although they are mostly dedicated to making chips for its internal consumption rather than for outside clients.

The DoD aims to change that dynamic by providing incentives for the development of chip-related intellectual property and the creation of advanced foundries in the U.S., reads a notice posted to the website of the National Security Technology Accelerator, a nonprofit group that works to connect private-sector companies to government contract opportunities.

The notice mentions that foundries that handle commercial work from U.S. companies could also provide components to the Defense Department.

The Defense Department plans to announce a program called “Rapid Assured Microelectronics Prototypes – Commercial”, or “RAMP-C” for short, that will complement existing programs it recently launched to encourage U.S. chip manufacturing.

“There is currently no commercially viable option that can provide a U.S. located leading-edge foundry that can fabricate the assured leading-edge custom integrated circuits and Commercial off the Shelf (COTS) products required for critical DoD systems. The purpose of the RAMP-C program is to incentivize such an option,” reads the posting.

Earlier this year in October, Intel won the second phase of a contract aimed at helping the U.S. military develop advanced chips more quickly.

TSMC is also building a $12 billion chip plant in Arizona; Phoenix city officials authorized a development agreement related to the project last month.

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