In a move drawing comparisons to the 2008 auto industry rescue, Intel has agreed to sell a 10% stake in its business to the U.S. government for $8.9 billion. The deal represents one of the largest government interventions in a private American company in recent history and underscores Washington’s determination to secure U.S. leadership in the global semiconductor race.
A Strategic Partnership Between Washington and Intel
At a press conference, former President Donald Trump announced that the deal came out of negotiations with Intel’s chief executive, Lip-Bu Tan.
“I said, ‘I think it would be good having the United States as your partner.’ He agreed, and they’ve agreed to do it,” Trump said. “And I think it’s a great deal for them.”
As part of the agreement, the federal government will invest $8.9 billion in Intel stock, in addition to the $2.2 billion already provided to the company through the CHIPS and Science Act. However, the U.S. will not seek a board seat or governance rights, positioning the stake as a financial partnership rather than direct control.
Intel’s CEO welcomed the investment, saying:
“We are grateful for the confidence the president and the administration have placed in Intel, and we look forward to working to advance U.S. technology and manufacturing leadership.”
Commerce Secretary Calls Deal ‘Historic’
Commerce Secretary Howard Lutnick described the agreement as “historic,” emphasizing its role in boosting U.S. dominance in semiconductors — the essential components powering everything from household electronics to advanced military systems.
In a social media post, Lutnick praised Intel’s leadership and said the deal was not just good for the company but also “fair to the American people.”
Parallels to the 2008 Auto Bailouts
The Intel stake sale is being compared to the government’s interventions in Chrysler and General Motors during the 2008 financial crisis, when tens of billions of dollars were poured in to prevent collapse. Similarly, this deal reflects Washington’s concern over maintaining competitiveness in semiconductors — a sector vital to national security and economic stability.
The move also highlights the Trump administration’s efforts to reshape the CHIPS Act, signed in 2022. Trump and his officials have criticized the original legislation, claiming it gave away money without securing returns.
“Donald Trump is fixing what Biden got completely, totally and utterly wrong,” Lutnick said in a CNBC interview, noting that turning federal support into equity ensures taxpayers benefit directly from Intel’s success.
Intel Stock Surges
The market responded positively to the news, with Intel shares climbing more than 6% following the announcement. Founded in 1968, Intel has long been a pioneer in chip technology, helping establish Silicon Valley as the hub of U.S. innovation.
However, in recent years, Intel has struggled to keep pace with competitors like Nvidia, which have surged ahead in artificial intelligence and high-performance computing. The fresh injection of government support could help Intel regain ground in a highly competitive sector.
A Deal Sealed Amid Tensions
The agreement came together rapidly. Just weeks ago, Trump had called for Tan’s resignation, citing his ties to Chinese companies. Shortly after, Tan met with Trump at the White House, where discussions about a government equity stake gained momentum.
By midweek, Intel’s finance chief David Zinsner and Commerce Secretary Lutnick had outlined the framework of the deal. Intel’s board approved it shortly after, and final terms were confirmed on Thursday.
Trump, never one to downplay his role, summed it up bluntly:
“Mr. Tan walked in wanting to keep his job, and he ended up giving us $10 billion for the United States.”
The Bigger Picture
This unprecedented partnership signals a new era in U.S. industrial policy, where the government is not just a regulator or grant provider but a shareholder in critical industries. For Intel, the deal represents a chance to stabilize and reinvent itself amid growing global competition. For the U.S., it is a direct stake in safeguarding technological leadership.
