US spends billions to boost chip production

US spends billions to boost chip production will it be enough


The US government is going to stop at all costs to promote domestic semiconductor production. Injecting billions of dollars into deprived sectors and adjust all existing policies in order to stand above the competition from Asia.


With the 2020 pandemic, companies have reduced orders for these tiny building blocks that are needed for smartphones, computers, cars and many other products.(US spends billions to boost chip production)The demand for information and communication technology is increasing. and the chip that drives them.


Chip shortage occurs. And the car factory had to stop production because the chip could not be found. This has contributed to the soaring prices of new and used cars. which is a major contributor to the painful inflation rate for Americans.


In a statement earlier this year, Commerce Secretary Gina Raimondo dubbed the semiconductor shortage. “National Security” issue Because it reveals the dependence on US production. in importing semiconductors from abroad The chip also supports critical military applications and is essential for cybersecurity tools.


Biden’s administration and lawmakers united in response, passing the CHIPS and Science Act into law in August. The legislation includes $52 billion to strengthen U.S. semiconductor manufacturing.


of this $39 billion has been earmarked for manufacturing incentives, $13.2 billion for research and development and employee training, and $500 million for securing international information communications technology and semi-supply chain activities.


behind that Several prominent companies have announced their importance. Investing in U.S. manufacturing, Taiwan Semiconductor Manufacturing Company (TSMC), an industrial powerhouse, has also pledged at least $12 billion to build a semiconductor plant in Arizona.



Production is expected to start in 2024.. at the beginning of the year Intel says it plans to create $20 billion. Semiconductor plant in Ohio and a new chip factory that just opened last month. And this month, Micron said it would invest. Up to $100 Billion in the Next Two Decades to build a large semiconductor factory in upstate New York.


In a tumultuous tweet earlier this month President Joe Biden pledge: “America is leading the way in microchip manufacturing.”


But the US has a lot to do. US chip factory or the current chip factory Account for 12% only of the world’s cutting-edge semiconductor production capacity, according to the Semiconductor Industry Association trade group.


Currently, approximately 75% of the world’s modern chip production is concentrated in East Asia. Most of them are in Taiwan with geopolitical vulnerabilities. And despite these new efforts, the US doesn’t have the talent and supply chain pipeline that some Asian markets do to support a strong homegrown industry.


to make this even more complicated. Public and private investment soaring at a dubious time As concerns about the global chip shortage have eased. The supply chain blockages related to the epidemic are mitigating somewhat, and the deteriorating economic outlook has hampered demand.


In an earnings call last week, TSMC CEO CC Wei warned that it expected “The semiconductor industry is likely to decline” in 2023. “TSMC is no exception,” Wei added, but said it expected. “It will be more flexible than the semiconductor industry as a whole.”


Promoting semiconductor manufacturing in the US now risks leading to overproduction and oversupply. and with reduced demand It was not immediately clear whether government subsidies would be sufficient to overcome other obstacles. Where the country is facing to develop a competitive semiconductor manufacturing hub?


To understand the latest efforts by the United States It is important to be clear where this country stands. It’s not just in the chip industry as a whole. but also associated with bags of particular value.


“The US is unlikely to increase its share of global production much. because even when the United States TSMC, Intel and others are announcing fabs elsewhere and building them even faster,” said Scott Kennedy, senior adviser at the Center for Strategic and International Studies.


“But I don’t necessarily think it’s a really big problem,” he added. He noted that the production metrics based on pure yield cubes shared between low-end and ultra-modern high-end chips are a realistic and important measure of success in chip manufacturing. “The United States needs to expand chip production for certain types of chips. which is directly related to American national security,” he said.


Biden’s management last Friday. clearing new export measures It is designed to limit China’s access to advanced semiconductor products made with US equipment. by aiming at production advanced weapon system


while only “about 10% to 14% of the chips sold [globally] It comes from a US manufacturing facility,” said Columbia Business School professor. Dan Wang USA has other strengths “in terms of design expertise. A large number of them are still in the United States.”


Still, the flaws are real. “When it comes to foundries, which are semiconductor manufacturing, the United States hasn’t been a major player for years,” Wang said. But manufacturing began to migrate to Asia in the 1980s and 1990s, Wang said. “One of the big reasons for this is that labor costs have come down, and it’s much cheaper to manufacture very large integrated circuits and chips in different parts of the world.” Wang added Morris Chang, founder of TSMC. It said it costs 50 percent more to make chips in the US.. than in Taiwan


For now, just a factory set up to manufacture or expand chip production. will give Asia a huge advantage Wang said he thinks that might be why you see the US. “Spending a lot of money to companies to set up factories in the United States.” Not just to meet demand and become more self-sufficient. “But because you have to get these things ready and act quickly. in order to be in the competition.”


Creating a new flat chip is a costly and time-consuming endeavor. “A modern facility is about half a million square feet,” said Gartner analyst Bob Johnson, and needs “a gigantic clean room with big air handling capabilities.” “Extraordinarily strong foundations,” as he said. “You can’t have a vibration in a fab because it can break. production process.”


Additionally, only one extreme ultraviolet lithography machine is required to map the chip’s circuitry. The cost is about 150 million US dollars.and Reuters reported that “A modern chip factory needs 9-18 of these machines.”


In addition, semiconductor manufacturing requires many specialized inputs. including pure chemicals such as fluoride polyimide and erosion gas chip milling machines, etc., in places such as Taiwan and Fukuoka. Japan The supply chain has evolved where the providers of these products are located close to the semiconductor plants. There are also one or two companies producing critical data and have long been a trusted supplier to Asian companies. This is not the case in places like Arizona and Ohio, which already have plans to build large chip factories.

You must have a willing and able workforce.


in the United States There are both new graduates and experienced staff whose technical and engineering knowledge required to manufacture semiconductors is scarce. Many people who may have the right experience instead prefer working in more modern industries.


“If we were today Flick our fingers and make new chips. Ten items with the world’s top chips. We wouldn’t have enough people to look after them,” Kennedy said. “That’s the biggest bottleneck in America’s expansion. not capital.”


Intel has tried to build a closer relationship with Arizona State University to recruit engineers, but It is unclear whether other companies and companies are building fabs in America. It will be able to employ sufficiently trained engineers and technicians. If not Even the billions of dollars given by the public and private sectors may not be enough to produce semiconductors.


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