The Biden-Harris administration revealed plans on Tuesday to allocate as much as $750 million in direct funding to Wolfspeed. This investment will support the company’s new silicon carbide manufacturing facility in North Carolina, which produces wafers essential for advanced computer chips, as well as its existing factory in Marcy, New York.
Wolfspeed’s incorporation of silicon carbide technology enhances the efficiency of computer chips used in electric vehicles and other sophisticated systems. The projects spearheaded by the North Carolina-headquartered company are anticipated to generate around 2,000 manufacturing jobs and are part of a broader expansion initiative totaling over $6 billion.
Commerce Secretary Gina Raimondo commented, emphasizing that technologies like artificial intelligence, electric vehicles, and clean energy will shape the future in the 21st century, and the proposed investments in companies such as Wolfspeed represent a significant move toward revitalizing American manufacturing in crucial chip technologies.
The Siler City Wolfspeed factory may also play a pivotal role in the upcoming elections, having opened in a swing state that is experiencing rapid economic growth, largely attributed to incentives from the Biden-Harris administration.
Vice President Kamala Harris is actively presenting the administration’s incentives to voters as a means for fostering job growth in factories. Conversely, former President Donald Trump argues that broad tariffs could motivate international factories to shift their operations to the U.S.
In 2023, President Joe Biden visited Wolfspeed to advocate for his economic strategy, asserting its potential to help America surpass China in competitiveness. During the 2020 presidential election, Trump narrowly won North Carolina and has expressed intentions to revive the state’s furniture manufacturing industry.
The rationale behind Biden-Harris administration’s strategy is that public support stimulates additional private investment, a theory that appears to be evidenced by Wolfspeed’s recent developments.
Alongside the government funding, a consortium of investment funds headed by Apollo, The Baupost Group, Fidelity Management & Research Company, and Capital Group intends to contribute another $750 million to Wolfspeed. With expectations of receiving $1 billion from advanced manufacturing tax credits, Wolfspeed is thus projected to have access to a total of up to $2.5 billion.
Gregg Lowe, the CEO of Wolfspeed, stated that the United States currently accounts for 70% of global silicon carbide production, and he affirmed that the new investments will help maintain this leading position as China intensifies its activities in the industry. He expressed satisfaction with the grant, noting the excellence of the Commerce Department staff involved in distributing funds from the 2022 CHIPS and Science Act.