BAE Takes Flight with CHIPS Act to Support Critical U.S. National Security Project in Nashua, New Hampshire

The U.S. Department of Commerce has awarded the first federal incentives under the CHIPS and Science Act to BAE Systems. The $35 million grant will support the modernization of BAE's Microelectronics Center in Nashua, New Hampshire, a critical facility producing chips for national security programs, including the F-35 fighter jet.

This landmark award marks the beginning of the CHIPS Act's implementation, aiming to revitalize domestic semiconductor manufacturing and strengthen U.S. technological independence. The grant will enable BAE to replace aging equipment at its New Hampshire facility, quadrupling its production capacity for mature-node chips essential for defense applications.

"Microelectronics are at the heart of the technology and products we make for our defense and aerospace customers," said Tom Arseneault, CEO of BAE Systems' U.S. unit, in a statement. "This investment will be a significant boost to our efforts in securing domestic chip production for critical national security needs.”

Commerce Secretary Gina Raimondo emphasized the importance of this initiative in securing U.S. technological leadership: "As national security becomes increasingly reliant on chips, this first CHIPS announcement shows how central semiconductors are to our national defense."

The CHIPS Act, passed in August 2022, provides $52 billion in subsidies and incentives to attract semiconductor manufacturers to the U.S. and foster domestic chip production across the entire value chain. This first award signals the Biden administration's commitment to implementing the Act and bolstering U.S. technological self-sufficiency.

Analysts predict this move to have significant implications for the U.S. semiconductor industry, potentially attracting further investments and partnerships in mature-node chip production, a segment often overlooked in the race towards ever-smaller and more advanced chips.

The BAE Systems grant is expected to create hundreds of high-tech jobs in Nashua and contribute to a broader resurgence of American chip manufacturing, particularly in sectors like defense and aerospace. The success of this project will be closely watched as a benchmark for the CHIPS Act's effectiveness in achieving its ambitious goals.