(Bloomberg) —
The Biden administration is launching a $1.6 billion funding competition for chip packaging research and development projects, marking the latest attempt to revitalize the domestic semiconductor industry.
The funding — coming from the 2022 Chips and Science Act — will pay for research in five areas, said Commerce Undersecretary for Standards and Technology Laurie E. Locascio. In addition to backing research, officials expect to help finance prototype development.
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Packaging — the process of encasing chips to both protect them and connect them to devices — is an essential part of the industry. The US accounts for just 3% of the world’s capacity, with the lion’s share of packaging done in Asia. But several companies — Intel Corp., SK Hynix Inc., Amkor Technology Inc. and Samsung Electronics Co. — are building packaging plants in the US.
The announcement represents by far the largest funding opportunity to come out of an $11 billion Chips Act R&D fund. The legislation also set aside $39 billion in grants — plus $75 billion in loans and loan guarantees, and 25% tax credits — to bring semiconductor manufacturing back to American soil after years of production shifting to Asia.
The five categories covered by the new program — equipment and tools, power delivery and heat management, connector technology, electronic design automation, and so-called chiplets — will get multiple awards of up to $150 million each. Chiplets are modular pieces of electronics designed for a specific function.
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