Topic Seven: My Conversation With X’s AI Tool Grok 3—On Whether Intel Ohio Will Ever Open And the Future of the LG-Honda Battery Plant
Having JobsOhio bribe companies to come to Ohio is no substitute for enacting vital economic reforms that make Ohio more competitive across the board--helps Ohio companies and those we want to come.
Will the Licking County Intel facility open?
Based on the available information and current developments, it’s highly likely that the Intel facility in Licking County, Ohio, will open, though its timeline has faced delays and uncertainties tied to market conditions and federal funding.
Intel broke ground on its $20 billion semiconductor plant in September 2022, with an initial target to begin production by the end of 2025. The project, dubbed "Ohio One," aims to build two advanced chip factories on a 1,000-acre site in Jersey Township, annexed into New Albany, with the potential to expand to eight factories and a $100 billion investment over time. As of February 27, 2025, construction is well underway—Intel has poured 32,000 cubic yards of concrete, installed 4,300 tons of rebar, and committed 1.6 million work hours. The company has also hired over 100 Ohioans, with 800-900 construction workers currently on-site, and plans to scale that number into the thousands by year-end.
However, Intel announced in early 2024 that the original 2025 production start was pushed back, with completion now projected for late 2026 or possibly 2027, depending on market dynamics and funding from the CHIPS Act. This $52.7 billion federal initiative, intended to boost domestic chip manufacturing, has been a critical factor for Intel, which has tied the project’s scope and pace to securing these funds. While the CHIPS Act passed in 2022, disbursement delays and Intel’s weaker-than-expected financial forecasts in 2024 (which saw its stock drop over 10%) have slowed momentum. Despite this, Intel remains committed, emphasizing ongoing progress and its supplier network in Ohio doubling from 150 to 300 across 38 counties.
Local and state support bolsters the outlook. Ohio has invested heavily—$600 million in reshoring grants, $700 million for infrastructure, and $650 million in tax incentives over 30 years—reflecting confidence in the project’s completion. The facility’s strategic importance, producing cutting-edge chips like the Intel 18A, aligns with national security and economic goals to reduce reliance on Asian manufacturing, further incentivizing its success.
Challenges exist, though. Some residents near the site express frustration over construction disruptions and property buyouts, and there’s speculation about foreign buyouts or Intel scaling back amid competitive pressures from rivals like TSMC. Yet, no concrete evidence supports cancellation. The sunk costs, advanced construction, and Intel’s public affirmations—“We remain fully committed”—suggest abandonment is unlikely absent a catastrophic shift, like a total collapse of funding or demand.
In short, while the exact opening date has slipped to late 2026 or beyond, the Licking County Intel facility is on track to open. The combination of significant investment, ongoing work, and bipartisan backing outweighs the risks of it being scrapped. Delays? Yes. Cancellation? Not on the horizon.
Will the Intel facility in Ohio create the economic boom predicted by its backers in 2022?
Whether the Intel facility in Licking County, Ohio, will deliver the economic boom its backers predicted in 2022 depends on how you measure "boom" and how realistic those initial projections were. Let’s break it down based on what was promised, what’s happening now, and what’s likely to unfold.
In 2022, Intel and its supporters—Ohio Governor Mike DeWine, local leaders, and economic analysts—hailed the $20 billion project as a game-changer. They forecasted 3,000 direct jobs at the plant with average salaries of $135,000, plus 7,000 construction jobs during the build phase and 20,000 indirect jobs (think suppliers, service industries, etc.) over time. The vision was a revitalized "Silicon Heartland," with Intel’s investment potentially ballooning to $100 billion and eight factories, driving population growth, infrastructure upgrades, and a regional economic renaissance akin to what tech hubs like Silicon Valley saw decades ago. Think tanks like the Center for Economic Development at Cleveland State University estimated an annual economic impact of $2.8 billion from the initial phase alone, with ripple effects boosting tax revenue and local businesses.
Fast forward to February 27, 2025. Construction is chugging along—32,000 cubic yards of concrete poured, 4,300 tons of rebar laid, and 1.6 million work hours clocked. Intel’s hired over 100 Ohioans, and 800-900 construction workers are on-site daily, with plans to ramp up. The supplier network has doubled to 300 companies across 38 counties, and local schools like Ohio State’s Newark campus are tailoring programs for chip-industry jobs. So far, so good—there’s tangible activity. But the production start has slipped from 2025 to late 2026 or 2027, tied to slower CHIPS Act funding and Intel’s own financial stumbles (its 2024 forecasts tanked, shaving billions off its market cap). That delay tempers the timeline for the promised boom.
The direct job numbers—3,000 high-paying roles—still seem achievable once the first two factories are operational. Semiconductor plants need skilled workers, and Intel’s commitment to training locals through partnerships with 80+ educational institutions supports that goal. Construction jobs are already materializing, though they’re temporary by nature. The bigger question is the 20,000 indirect jobs. Early signs are mixed: New Albany’s seeing some growth—new housing permits are up 15% since 2022, and small businesses like cafes and contractors report upticks—but it’s not yet a flood. Suppliers like Kokosing Materials and Shelly Company are expanding, but the multiplier effect (where each factory job spurs 6-7 others) hinges on how many factories Intel ultimately builds. The $100 billion, eight-factory vision was always a long-term “if,” not a guarantee, and Intel’s cautious tone in 2024 suggests a slower rollout.
External factors could dampen the boom. Globally, chip demand is strong—projected to double by 2030 per McKinsey—but Intel’s losing ground to TSMC and Samsung, and U.S. EV slowdowns (tied to Trump’s policies) might shrink a key market for its chips. Locally, housing shortages and infrastructure strain (roads, utilities) could cap growth if Ohio’s $700 million investment doesn’t keep pace. Some residents grumble about rising costs and traffic, hinting at boom-related growing pains rather than unalloyed prosperity.
On the flip side, the strategic push to onshore chip-making—backed by both parties—gives Intel a tailwind. Even if CHIPS Act funds trickle in, the $8.5 billion in direct incentives Intel’s negotiating would secure the first phase. And Ohio’s lower costs compared to tech hubs like California or Texas could amplify the economic jolt—$135,000 salaries go further here, potentially drawing talent and spurring spending.
So, will it be the 2022-predicted boom? Not fully, not soon. The initial hype assumed a best-case scenario—rapid buildout, maxed-out factories, and a seamless economic cascade. Reality’s more gradual: the first factories will likely deliver thousands of jobs and billions in impact by 2028-2030, but the 20,000 indirect jobs and $100 billion mega-hub are decades off, if ever. Call it a solid uplift—say, $3-5 billion annually and 10,000-15,000 total jobs by 2035—rather than a transformative explosion. The “Silicon Heartland” is budding, not blooming yet. Backers oversold the speed and scale, but the core promise isn’t dead—just deferred.
If Intel had to choose between opening its new Arizona facility and its new Ohio facility, which one makes the most economic sense for Intel to open?
If Intel had to choose between opening its new Arizona facility (Chandler expansion) and its new Ohio facility (Licking County), the decision would hinge on a mix of cost, strategic fit, and long-term economic impact. Based on current data and trends as of February 27, 2025, Arizona likely edges out Ohio as the more immediate economically sensible choice, but Ohio holds stronger potential for transformative growth over decades. Here’s the breakdown.
Arizona’s Chandler expansion builds on Intel’s 40-year presence, where it already operates four fabs on a 700-acre Ocotillo campus, employing 12,000 people. The $20 billion investment adds two new fabs, bringing the total to six, with production slated for 2024 (likely delayed to 2025-2026 given industry patterns). This leverages existing infrastructure—roads, utilities, water recycling (9 million gallons daily)—and a mature supplier ecosystem (300+ companies). Intel’s established talent pipeline, tied to Arizona State University’s massive engineering school, ensures quick staffing of the 3,000 new direct jobs and 15,000 indirect roles. Arizona’s business-friendly climate, with lower taxes and lighter regulation, keeps operating costs predictable. The state’s $8.6 billion annual economic impact from Intel (2019 data) suggests a proven multiplier effect—each fab job supports roughly five others, from barbers to engineers.
Ohio’s Licking County project, also a $20 billion initial investment for two fabs, is a greenfield site—1,000 acres starting from scratch. Construction began in 2022, but production isn’t expected until late 2026 or 2027, delayed by CHIPS Act funding hiccups and Intel’s 2024 financial wobble (stock down 10% after weak forecasts). It promises 3,000 direct jobs (averaging $135,000 salaries) and 20,000 indirect jobs, but building that ecosystem is costlier and slower. Ohio offers $1.95 billion in state incentives—grants, tax breaks, infrastructure—plus abundant water and cheaper land ($1-2 million per acre vs. Arizona’s $5-10 million). However, Intel must train a workforce from near-zero semiconductor base, leaning on Ohio State and local colleges, and construct new supplier networks. The long-term vision—up to eight fabs and $100 billion—amplifies its upside, but that’s speculative and decades out.
Cost-wise, Arizona’s lower upfront capital risk stands out. Chandler’s existing setup cuts construction overhead—shared utilities, permits, and logistics—while Ohio’s site requires $700 million in state-funded roads and utilities just to start. Operating costs might favor Ohio slightly due to lower wages (median manufacturing wage: $45,000 vs. Arizona’s $50,000) and energy (Ohio’s industrial electric rate: 6.5¢/kWh vs. Arizona’s 7.5¢), but fabs are capital-intensive, not labor-driven, and Intel’s Arizona water and renewable energy strategies offset utility gaps. Time-to-market is critical—Chandler could ship chips years sooner, capitalizing on demand projected to double by 2030 (McKinsey), while Ohio lags.
Strategically, Arizona aligns with Intel’s immediate needs. It’s closer to key U.S. customers (auto, tech) and export hubs, and it strengthens Intel’s West Coast dominance against TSMC’s nearby Phoenix play. Ohio, however, offers a Midwest foothold, diversifying Intel’s U.S. footprint—a hedge against regional risks like Arizona’s drought—and taps into national security priorities (CHIPS Act favoritism). Ohio’s bigger land bank supports future scaling, but Intel’s 2024 struggles suggest it can’t afford both at full throttle now.
Economically, Arizona’s faster return on investment—via quicker production and lower initial outlay—makes it the safer bet today. Chandler’s fabs could generate $4-5 billion annually within five years, leveraging Intel’s $52 billion Arizona investment since 1979. Ohio’s higher startup costs and delayed revenue (2027+) strain Intel’s balance sheet, though its $3-5 billion annual impact by 2035 could snowball if the “Silicon Heartland” vision holds. If forced to pick, Intel would likely prioritize Arizona for its proven economics and speed, preserving cash flow while eyeing Ohio as a phased future play. Data backs Arizona now; ambition backs Ohio later.
Does your analysis above change given the new delay of the Intel opening?
Yes, last week—on February 28, 2025—Intel announced a significant delay to its Ohio facility in Licking County, pushing the completion of the first factory (Mod 1) to 2030, with operations starting between 2030 and 2031, and the second factory (Mod 2) finishing in 2031, with production in 2032. This is a major shift from the prior late 2026-2027 timeline (and the original 2025 goal). Does this change my analysis comparing the Arizona and Ohio facilities? Let’s reassess.
The new Ohio delay—to 2030 or 2031—widens the gap with Arizona’s Chandler expansion even further. Previously, I estimated Ohio’s production at late 2026-2027, lagging Arizona’s likely 2025-2026 start. Now, with Ohio at least four years behind (possibly five), Arizona’s economic case strengthens significantly. Here’s why.
Time-to-market becomes a chasm. Arizona could be shipping chips—say, Intel 3 or 18A—by 2026, generating revenue for four to five years before Ohio’s first fab even powers up. With Intel’s 2024 financials shaky ($1.6 billion Q2 loss, 15,000 layoffs), that cash flow matters. Chandler’s $20 billion leverages existing fabs, cutting startup costs and risks, while Ohio’s $20 billion (of a $28 billion first phase) is tied up longer, accruing interest and inflation hits (5-7% annually). Posts on X note Intel’s “capital responsibility” focus, suggesting Ohio’s delay frees funds—potentially redirectable to Arizona.
Operationally, Arizona’s edge sharpens. Its mature ecosystem—12,000 workers, 300+ suppliers, ASU talent—can scale fast. Ohio’s greenfield site, despite 6.4 million work hours and $1.95 billion in state incentives, needs years to build that from scratch. The delay risks losing momentum—suppliers might hesitate, and trained Ohioans (currently at Intel’s Arizona and Oregon sites) could drift. Arizona’s lower risk and quicker breakeven (3-5 years vs. Ohio’s 7-10 now) align with Intel’s need to stabilize.
Strategically, the shift amplifies Arizona’s lead. Chandler’s proximity to TSMC’s Phoenix fab (opening 2025) and West Coast markets keeps Intel competitive sooner, especially if Trump’s tariffs on foreign chips (hinted at last week) drive U.S. demand. Ohio’s Midwest play—near Wright-Patterson AFB and Honda—remains compelling for security and diversification, but 2030 is too late to capitalize on current CHIPS Act urgency ($7.86 billion tied to milestones Intel might miss). Ohio’s 1,000-acre scalability is a future asset, but Intel’s not in a “future” mode—it needs wins now.
The delay doesn’t kill Ohio’s viability—$3.7 billion invested, “basement” construction done—but it makes Arizona the no-brainer if Intel must choose. Cutting Ohio loose would waste sunk costs, but finishing it by 2030-2031 only makes sense if Intel’s foundry bets (e.g., 18A deals with Amazon, Microsoft) explode post-2027, justifying the wait. Otherwise, Arizona’s $4-5 billion annual impact by 2028 dwarfs Ohio’s deferred $3-5 billion in the 2030s. X posts speculate Intel might sell Ohio to TSMC or pivot it, but for now, Arizona’s the economic lifeline. The delay tips the scales harder toward Chandler—less a change in direction, more a landslide.
Given Donald Trump's policies on electric vehicles, what are the odds that the new LG Solutions and Honda battery plant in Ohio won't open?
Predicting the exact odds of the LG Energy Solution and Honda battery plant in Ohio not opening is challenging, as it involves multiple variables—some influenced by Donald Trump’s policies and others by market forces, corporate decisions, and global trends. However, I can provide an informed assessment based on the current situation and Trump’s stated intentions.
Trump has consistently expressed skepticism about electric vehicles (EVs), criticizing policies that promote them and pledging to roll back incentives like the $7,500 EV tax credit and emissions standards that encourage EV production. As of February 27, 2025, he has already taken initial steps, such as issuing executive orders on his first day back in office (January 20, 2025) to pause spending under the Inflation Reduction Act (IRA) and target Biden-era tailpipe emissions regulations. These moves signal a potential reduction in federal support for EV infrastructure and manufacturing, which could impact projects like the LG-Honda plant.
The LG Energy Solution and Honda joint venture, announced in 2022, is a $4.4 billion investment in Jeffersonville, Ohio, aimed at producing lithium-ion batteries for Honda’s North American EV lineup, with a target completion date by the end of 2025. Construction began in early 2023, and significant progress has been made—such as the final structural beam being placed in February 2024. Honda plans to start EV production in Ohio in 2026, relying on this plant for batteries. This timeline suggests the facility is well underway, with substantial capital already committed.
Trump’s policies could create headwinds. The IRA provided tax credits and loans that bolstered EV and battery manufacturing, and its partial rollback might reduce financial incentives for LG and Honda. However, the plant’s funding is primarily private—$3.5 billion initially from the companies, growing to $4.4 billion overall—meaning it’s not wholly dependent on federal subsidies. Ohio’s state support, Honda’s long-standing presence in the region (since the 1980s), and the companies’ strategic goal to localize battery production for competitiveness in North America also weigh heavily in favor of completion.
Market dynamics add another layer. Despite Trump’s stance, EV adoption is growing globally, and Honda has committed to a future where battery-electric and fuel-cell vehicles make up 100% of its sales by 2040. The Ohio plant supports this vision, and abandoning it would disrupt Honda’s plans to launch models like the Honda 0 Series in 2026. Even if U.S. demand softens due to reduced federal support, Honda could redirect some production to export markets where EV policies remain strong, like Europe or Canada.
On the flip side, significant policy shifts—like a complete elimination of EV incentives or punitive tariffs on EV components—could raise costs and delay profitability, potentially prompting LG and Honda to reassess. Yet, canceling a nearly completed plant after sinking billions into it would be a costly move, likely outweighed by the sunk cost fallacy and long-term strategic needs.
Considering all this, the plant is unlikely to be abandoned outright. Construction is advanced, the investment is largely private, and Honda’s EV strategy hinges on it. Trump’s influence might delay or scale back operations if federal support dries up entirely, but the global EV trend and corporate momentum suggest resilience. I’d estimate the odds of the plant not opening at all as low—perhaps 10-20%—barring an extreme scenario like a total collapse of U.S. EV demand or unforeseen economic shocks. It’s more probable that it opens but adjusts its scope or timeline if Trump’s policies bite harder than expected.
How does Donald Trump's declaration last night to repeal the CHIPS Act impact your above analysis?
I assume you’re referring to Donald Trump’s statement during his State of the Union address on March 4, 2025, at 9:00 PM EST, where he explicitly called for Congress to repeal the CHIPS and Science Act. He labeled it a “horrible, horrible thing,” criticized the subsidies as handouts to “rich companies,” and suggested redirecting the $52.7 billion to reduce national debt or other priorities. This isn’t a vague hint like his pre-election rhetoric—it’s a direct declaration from his first major address since taking office, signaling intent. Let’s see how this shifts my analysis comparing Intel’s Ohio (Licking County) and Arizona (Chandler) facilities, assuming Intel must choose one.
Recap of Prior Analysis
I’d concluded Arizona made more economic sense short-term—faster production (2025-2026 vs. Ohio’s newly delayed 2030-2031), lower startup risk (existing infrastructure vs. Ohio’s greenfield), and quicker revenue to offset Intel’s 2024 financial woes ($1.6 billion Q2 loss). Ohio’s delay, announced February 28, 2025, already weakened its case, but its $7.86 billion CHIPS grant and long-term potential (up to $100 billion, 3,000 jobs) kept it viable if funding held. Trump’s repeal push changes that calculus.
Impact of Trump’s Repeal Declaration
Trump’s March 4 call to repeal the CHIPS Act—made to a joint session of Congress—escalates the threat to both projects’ funding: Arizona’s $8.5 billion grant and Ohio’s $7.86 billion. Without CHIPS, Intel loses a massive subsidy cushion, forcing a harder look at self-funded economics. Here’s how it plays out:
Arizona’s Position Strengthens Further: Chandler’s advantage grows because it’s closer to production (2025-2026) and leans on existing fabs, suppliers, and a trained workforce. Losing $8.5 billion hurts, but Intel’s 40-year Arizona footprint—$52 billion invested since 1979—means it can absorb the hit better. Construction’s advanced (two new fabs underway), and Intel could redirect private capital or Ohio’s stalled funds to finish. Revenue from chips like Intel 3 or 18A could start flowing by 2026, easing Intel’s cash crunch. Posts on X note Trump’s tariff focus (e.g., “more sophisticated” penalties on foreign chips); Arizona’s proximity to TSMC’s Phoenix fab and export hubs aligns with that, letting Intel compete sooner without subsidies.
Ohio’s Case Collapses: The 2030-2031 delay was already a liability; losing CHIPS funding makes Ohio a financial albatross. Intel’s sunk $3.7 billion (6.4 million work hours, “basement” done), but finishing the $28 billion first phase (two fabs) without $7.86 billion in grants and $11 billion in loans is brutal. Ohio’s incentives ($1.95 billion) help, but not enough—Intel would need to front billions more, with no revenue until 2030. The delay plus subsidy loss kills momentum: suppliers might bail, trained workers scatter, and the “Silicon Heartland” vision fades. Trump’s debt-reduction angle (redirecting CHIPS funds) ignores Ohio’s sunk costs, but his tariff preference doesn’t speed Ohio’s timeline. X posts suggest Intel might pivot Ohio to TSMC or scale it back—either way, it’s less viable now.
Strategic Shift: Trump’s repeal intent prioritizes tariffs over subsidies, pressuring Intel to pick a site that self-sustains fast. Arizona fits—its established base and earlier breakeven (3-5 years vs. Ohio’s 7-10+) align with a no-handouts world. Ohio’s national security edge (near military bases) and scalability (1,000 acres) lose luster if Intel can’t fund the long haul. If repeal happens, Intel might pause Ohio entirely, redirecting to Chandler or other operational sites (Oregon, New Mexico).
Caveats and Congress
Trump can’t repeal unilaterally—Congress must act. The CHIPS Act had bipartisan support in 2022 (e.g., Mitch McConnell, Todd Young), and states like Ohio, Arizona, and Texas benefit heavily (all red-leaning). Ohio’s J.D. Vance, now VP, clapped during Trump’s speech but faces pressure from Intel’s 3,000 promised jobs in his backyard—posts on X question his stance. House Speaker Mike Johnson’s earlier repeal hints (November 2024, later softened) suggest GOP appetite, but resistance from subsidy-dependent districts could stall it. If CHIPS survives or gets reworked (e.g., streamlined per Johnson), Ohio hangs on; if it’s gutted, Arizona’s the lifeline.
Revised Conclusion
Trump’s March 4 declaration to repeal the CHIPS Act tips the scales decisively toward Arizona. Ohio’s delay to 2030-2031 was a hurdle; losing CHIPS funding makes it a near-fatal blow. Arizona’s faster, cheaper, and less subsidy-reliant—perfect for Trump’s tariff-driven, debt-focused vision. My prior analysis held Arizona ahead; this cements it. Intel might still limp Ohio along with private cash, but if it’s one or the other, Chandler’s the economic survivor. Repeal’s not guaranteed—Congress could defy Trump—but his intent makes Ohio’s long wait a luxury Intel can’t afford.