Intel CEO Asks US Government for More Backing, Calls Taiwan Not Stable

Since Intel CEO Pat Gelsinger joined the company earlier this year, the messaging language from Intel has changed radically, as it has become a no-nonsense message of Intel going back to its roots as a leading foundry and a leading chip maker. However, Gelsinger might’ve overstepped a little bit as of lately, as during a conference in California, he went on record saying that Intel deserves special treatment by the US government, in favor of some of its competitors.

At the same time, it’s not hard to see why Intel thinks the US government should favor it and other US companies like Micron and Texas Instruments, over Samsung and TSMC. However, Intel’s selling argument here is that investing in non-US companies means that the R&D money and IP ends up abroad, which isn’t entirely true when it comes to foundries. Gelsinger also complained about the fact that Samsung and TSMC was getting large government subsidies in their home countries and claimed that because of those subsidies, Intel was competing with Korea and Taiwan, rather than with Samsung and TSMC.

As if that wasn’t enough, Gelsinger went on to call Taiwan “not a stable place” due to the current situation between the PRC and Taiwan. He also highlighted the fact that the PRC is infringing on Taiwan’s air defence identification zone (ADIZ) on a regular basis, with as many as 27 military aircraft encroaching on a single day. It should be noted that the Taiwan ADIZ actually stretches well inside the PRC, although the areas that the PRC normally enter that are being reported are quite close to Taiwan, rather than flights over PRC territory.

The US government still hasn’t reached a conclusion on the CHIPS Act, which is meant to set aside as much as US$52 billion for chipmakers in the US. There’s no secret that Intel wants a large share of that money, deservedly so or not. As Intel is slowly moving towards offering foundry services, it makes sense that they would need to invest even more heavily into building foundries, since as we know, there simply aren’t enough cutting edge foundries at the moment and too many companies are fighting over the cutting edge nodes these days. That said, scare tactics isn’t the way forward, instead Intel should show that they can operate a foundry business just as well as its competitors and try to win over business from them, as that’s how you show that you deserve both the business and the investment.