As President-elect Donald Trump prepares to take office for a second term, his administration signals plans to refine the CHIPS and Science Act while emphasizing a continued push for domestic semiconductor production. The Biden administration has been actively allocating funding under the CHIPS Act, but Trump’s incoming team is expected to review and possibly adjust grant distributions and incentive structures to better align with its economic and geopolitical priorities.
A key focus of the Trump administration’s commentary centers on the origins of the CHIPS Act, which was first conceptualized during his initial presidency. Advocates of the program point out that Trump laid the groundwork for incentivizing domestic chip production, including securing Taiwan Semiconductor Manufacturing Company’s (TSMC) first investment in Arizona. The CHIPS Act, which officially passed under Biden, builds on these early initiatives to reduce U.S. reliance on foreign semiconductor manufacturing, particularly from China and Taiwan.
One of the early funding decisions that has garnered attention is the Biden administration’s reported reduction of Intel’s $8.5 billion grant to below $8 billion. The adjustment reflects attempts to balance Intel’s request with the $3.5 billion grant the company received from the Pentagon. Trump’s team has not yet commented directly on this decision but is expected to scrutinize such allocations to ensure they align with national security and economic interests.
Christopher Miller, a professor at Tufts University and author of The Chip War: The Fight for the World’s Most Critical Technology, predicts that while specific grant amounts or recipients might be adjusted under Trump, the overarching goal of boosting domestic semiconductor manufacturing will remain unchanged. Miller notes that the program’s basic framework aligns with Trump’s longstanding push for economic nationalism and technological self-sufficiency.
Another area of focus is likely to be tariff policies and export controls targeting China. Trump is expected to reinforce these measures, particularly in light of China’s growing ambitions in the tech sector. His administration may implement stricter controls on semiconductor equipment exports to Chinese companies, further intensifying the U.S.-China tech rivalry. Policies could also include new tariffs or incentives designed to encourage American companies to build resilient supply chains that exclude Chinese components.
Industry leaders and analysts are watching closely to see how Trump’s administration will balance financial incentives for domestic manufacturers with geopolitical considerations. The semiconductor industry is crucial not only for consumer electronics but also for national security, as chips power military systems, communications infrastructure, and emerging technologies like artificial intelligence.
While Trump’s approach may include amendments to grant distributions or shifts in focus, his administration’s overarching goal will likely be to ensure that the U.S. remains a leader in the global semiconductor industry. As the CHIPS Act evolves under Trump, the program is expected to reflect his administration’s priorities, reinforcing the importance of domestic production while addressing the competitive challenges posed by China.
