Intel Corp.’s $20 billion chip manufacturing project in Ohio reportedly will be delayed because of a lack of U.S. government grants and challenges in the market.

It had been hoped that by 2025, the first two chipmaking facilities would be finished, but now it’s expected that the construction of the manufacturing plants won’t be ready until 2026, the Wall Street Journal reported today, based on people involved with the project.

That follows another delay in 2022 when Intel had to put the brakes on the groundbreaking because of what was reported as “uncertainty” around the Bipartisan Innovation Act, also known as the CHIPS Act, an initiative by the White House to promote chipmaking research and production in the U.S. At the time, the White House had promised to “unlock hundreds of billions more in private sector semiconductor investment.”

It seems the rollout of those government funds has been dragging, and with a slow market, the company has had to be realistic about its production timeline. An Intel spokesperson told The Journal that it has to adapt to changing conditions. The company has also said it would “depend heavily” on those governments to put the wheels in motion.

The U.S. has been trying to become less reliant on Asia for its chips, given the instability of its relationship with China. The White House hopes to bring jobs back to the U.S. and rely less on Taiwan while making life hard for China, where China’s chipmaking is concerned. Nonetheless, government money for projects such as Intel’s has been slow to roll out.

Right now, it’s reported that there are abut 800 people on the site currently working on the project, but it’s expected that this number will rise to many thousands by the end of 2024. In all, the project will create about 7,000 construction jobs. This is just for the first two plants. The entire complex will require an investment in the region of $100 billion.

Despite these setbacks, a plant in New Mexico that has been in the pipeline for years was opened last week. Other large projects include facilities in Arizona and Oregon.

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