TSMC ’s Arizona subsidiary is set to receive up to $6.6 billion in U.S. government funding under a preliminary agreement announced by the Biden administration. The funding, under the U.S. CHIPS and Science Act, will support Taiwan Semiconductor Manufacturing Co.’s more than $65 billion investment in three cutting-edge fabrication plants in Phoenix, according to the nonbinding agreement.
While chip maker Intel in Rio Rancho is also expanding it's not the game changer state economic planners are still looking for as they seek the elusive "diversification" of the economy. But the longtime cornerstones of the economy are solid.
--New Mexico is now the second largest producer of oil in the USA, trailing only neighboring Texas. And the bull market still has legs, with peak production still several years away.
--Los Alamos National Labs is seeing unprecedented job and budget growth as the "pit" production program for nuclear weapons gets underway and will last for years.
--It's not on the scale of Los Alamos but ABQ's Sandia National Labs is also seeing steady job and budget growth.
--The large footprint of ABQ's Kirtland Air Force Base remains and is not threatened by federal closure but NM base watchers are keeping an eye on Cannon AFB in Clovis since restructuring there transferred over 300 personnel to Arizona.
Back on the diversification front, economic gurus are nervous about a $1 billion investment in a solar manufacturing plant announced last year by Singapore-based Maxeon Solar Technologies at ABQ's Mesa Del Sol. Maxeon's stock has since plumbed new lows. In fact it hit a new all-time low of $2.33 on Wednesday. The company is sensitive to higher interest rates and is now valued at only $150 million.
Federal subsides, however, are key to that Maxeon ABQ invesment and a favorable announcement is expected soon.
And the stock of billionaire Richard Branson's Virgin Galactic, the chief tenant of the NM Spaceport, has also been trading at new lows as doubts continue about the viability of the company's plans to put thousands of thrill seekers paying hundreds of thousands dollars apiece to be launched into space. As with Maxeon, this company important to the state traded Wednesday at a new all-time low of only $1.04 a share. At that price the company is valued under $450 million, crashing from multi-billions in valuation.
(c)NM POLITICS WITH JOE MONAHAN 2024