The Biden administration announced a preliminary deal Monday with BAE Systems Inc. to provide $35 million in funding through the CHIPS and Science Act for the company’s defense projects, including its F-35 fighter jet program.
The announcement is the first preliminary agreement to be struck through the CHIPS and Science Act, a bipartisan piece of legislation President Biden signed into law last year. The money will be used to upgrade a chip factory in Nashua, N.H.
In a statement, Biden called it a “key milestone” in the implementation of the law. When finalized, the funding will be used by BAE Systems to “modernize an aging facility to quadruple its production capacity for chips that are essential to our national security,” Biden said.
“Today’s announcement is the first step of many to come,” he said. “Over the coming year, the Department of Commerce will award billions more to make more semiconductors in America, invest in research and development capabilities to keep America at the forefront of new technologies, strengthen our national security, and create good-paying jobs.”
Biden has repeatedly touted the importance of the CHIPS and Science Act, citing the prevalence of microchips that are used in everyday technology like phones, cars, home appliances and more.
In Monday’s announcement, Biden noted the U.S. has gone from producing nearly 40 percent of the world’s chips to just more than 10 percent in recent years, creating dependence on foreign supply chains that have led to higher prices.
“My CHIPS and Science Act aimed to change that — and already, we are revitalizing America’s leadership in semiconductors, strengthening our supply chains, protecting national security, and advancing American competitiveness as a result of the law and our Investing in America agenda,” Biden said.
Biden has previously touted new domestic investments after the law was passed, visiting a planned Intel factory in Ohio and boasting of investments by Micron and IBM in New York.