US chip production is poised to explode in coming years, helping ease a risky dependency on East Asia, according to a projection by the Semiconductor Industry Association (SIA).
Semiconductor manufacturing capacity in the country will triple by 2032, an SIA-commissioned study by the Boston Consulting Group found. That will take the US share of the industry to 14 percent, up from 10 percent currently, according to the report, which was released yesterday.
The surge will reverse a downward trend for domestic chip production, which had been decamping for Asia in recent decades. Were it not for government funding programs like the 2022 CHIPS and Science Act, the US share was on course to shrink to 8 percent, the study found.
Photo: Reuters
The Washington-based SIA, which lobbied hard for the CHIPS Act, is eager to show that the legislation is paying off. It also wants the US government to devote more funding to the cause.
“We’ve always said that the CHIPS Act was a strong first step, but we’re going to need more to get to the promised land,” SIA chief executive officer John Neuffer said in an interview. “Our industry fully understands that we have an over-concentration of manufacturing in East Asia.”
The CHIPS Act set aside US$39 billion in grants — plus US$75 billion in loans and loan guarantees, and 25 percent tax credits — to persuade semiconductor firms to build factories on American soil.
In the wake of that legislation, the US has secured commitments from all five of the world’s top chipmakers to add facilities in the country. That includes the three main manufacturers of cutting-edge logic chips, the components that serve as the brains of devices: Taiwan Semiconductor Manufacturing Co (台積電), Samsung Electronics Co and Intel Corp.
US Secretary of Commerce Gina Raimondo, whose agency is responsible for doling out CHIPS Act funds, has said the US aims to produce one-fifth of the world’s advanced logic chips by the end of the decade.
Building some extra capacity also will help protect against the kind of disruptions that occurred during the COVID-19 pandemic, Neuffer said. But that represents a shift away from the industry valuing efficiency above all else.
The US isn’t the only one increasing its chip manufacturing ambitions, according to the report. China is building about 30 new facilities for parts of the chip supply chain, topping the US’s 26. And there are eight such projects under way in the European Union.
When Lika Megreladze was a child, life in her native western Georgian region of Guria revolved around tea. Her mother worked for decades as a scientist at the Soviet Union’s Institute of Tea and Subtropical Crops in the village of Anaseuli, Georgia, perfecting cultivation methods for a Georgian tea industry that supplied the bulk of the vast communist state’s brews. “When I was a child, this was only my mum’s workplace. Only later I realized that it was something big,” she said. Now, the institute lies abandoned. Yellowed papers are strewn around its decaying corridors, and a statue of Soviet founder Vladimir Lenin
ELECTRONICS BOOST: A predicted surge in exports would likely be driven by ICT products, exports of which have soared 84.7 percent from a year earlier, DBS said DBS Bank Ltd (星展銀行) yesterday raised its GDP growth forecast for Taiwan this year to 4 percent from 3 percent, citing robust demand for artificial intelligence (AI)-related exports and accelerated shipment activity, which are expected to offset potential headwinds from US tariffs. “Our GDP growth forecast for 2025 is revised up to 4 percent from 3 percent to reflect front-loaded exports and strong AI demand,” Singapore-based DBS senior economist Ma Tieying (馬鐵英) said in an online briefing. Taiwan’s second-quarter performance beat expectations, with GDP growth likely surpassing 5 percent, driven by a 34.1 percent year-on-year increase in exports, Ma said, citing government
UNIFYING OPPOSITION: Numerous companies have registered complaints over the potential levies, bringing together rival automakers in voicing their reservations US President Donald Trump is readying plans for industry-specific tariffs to kick in alongside his country-by-country duties in two weeks, ramping up his push to reshape the US’ standing in the global trading system by penalizing purchases from abroad. Administration officials could release details of Trump’s planned 50 percent duty on copper in the days before they are set to take effect on Friday next week, a person familiar with the matter said. That is the same date Trump’s “reciprocal” levies on products from more than 100 nations are slated to begin. Trump on Tuesday said that he is likely to impose tariffs
HELPING HAND: Approving the sale of H20s could give China the edge it needs to capture market share and become the global standard, a US representative said The US President Donald Trump administration’s decision allowing Nvidia Corp to resume shipments of its H20 artificial intelligence (AI) chips to China risks bolstering Beijing’s military capabilities and expanding its capacity to compete with the US, the head of the US House Select Committee on Strategic Competition Between the United States and the Chinese Communist Party said. “The H20, which is a cost-effective and powerful AI inference chip, far surpasses China’s indigenous capability and would therefore provide a substantial increase to China’s AI development,” committee chairman John Moolenaar, a Michigan Republican, said on Friday in a letter to US Secretary of
RSS