WEST LAFAYETTE, Ind. (WISH) — U.S. Secretary of Commerce Gina Raimondo on Tuesday said federal investment will be crucial to get a key microprocessor factory off the ground near the Purdue campus.

Raimondo said the federal government will provide up to $450 million to help fund the construction of SK Hynix’s semiconductor packaging facility and related research and development facility planned for West Lafayette. She said this means the United States now has committments from all five leading semiconductor manufacturers–Intel, PSMC, Samsung, Micron and SK Hynix. Raimondo said those are the only companies in the world capable of producing leading-edge computer chips, particularly those needed for artificial intelligence applications, at scale.

“It means we, in the United States, will have the most secure and diverse supply chain in the world for the advanced semiconductors that power artificial intelligence,” she said.

Biden administration officials said the federal dollars will ensure the United States is the only country in the world in which all five companies have major manufacturing concerns. They said computer industry trade groups now estimate, based on announcements since the CHIPS and Science Act was passed, the United States will manufacture 28 percent of the world’s advanced logic chips by 2032, up from zero in 2022. Sen. Todd Young, R-Indiana, was a key co-author of the act.

The facility will manufacture high bandwidth memory, or HBM, chips, the type specifically needed for AI. Officials estimate it will generate about 1,000 new jobs.

Officials said the funding won’t be provided unless SK Hynix meets certain milestones. Right now, construction of the facility is expected to begin around the middle of next year, with chip packaging beginning by 2028. Officials said the final funding amount might differ.

Statements

“One of the primary goals of the CHIPS and Science Act was to bring semiconductor manufacturing back to the United States. I’m thrilled that this investment is being made right here in Indiana to help our country continue to shore up our domestic supply chain. We cannot afford to rely on China or other countries for components that are critical to our national security.”

U.S. Sen. Todd Young, a Republican from Indiana

“We are excited about the Department of Commerce’s support, through the CHIPS and Science Act, of the largest semiconductor production facility located at a university in the U.S. This facility will be transformational, as SK hynix leads globally in AI memory chips. And as the leading American university in this foundational technology, Purdue University is committed to co-creating jobs, workforce and innovation in our state and the Silicon Heartland.”

Purdue University President Mung Chiang