MEMS and Sensors

SIA: US on track to expand chip manufacturing 203% by 2032

09 May 2024
An Intel engineer holds a semiconductor wafer inside a foundry cleanroom. Intel is one of several chipmakers that are building new semiconductor fabs in the U.S. with the help of direct funding from the CHIPS and Science Act. Source: Intel

Thanks to investments from the CHIPS and Science Act that was enacted in 2022, U.S. domestic semiconductor manufacturing capacity is expected to grow a whopping 203% over the next decade — the largest increase in the world over this time, according to new data from the Semiconductor Industry Association (SIA).

This will result in America projected to capture 28% of total global capital expenditures from 2024 to 2032, only second to Taiwan at 31%. Additionally, the U.S. share of advanced logic manufacturing will grow to 28% up from virtually 0% in 2022, the SIA forecasts.

If the CHIPS Act was not signed, the U.S would have only captured 9% of the global capex by 2032, according to the SIA’s new report “Emerging Resilience in the Semiconductor Supply Chain.” In the previous decade — 2012-2022 — the U.S. ranked dead last among chipmaking regions with just 11% growth during the period, SIA said.

Source: SIA Source: SIA “Effective policies, such as the CHIPS and Science Act, are spurring more investments in the U.S. semiconductor industry,” said Rich Templeton, chairman of the board at Texas Instruments and SIA board chair. “These investments will help America grow its share of global semiconductor production and innovation, furthering economic growth and technological competitiveness.”

Templeton added that continued government-industry collaboration will help build domestic semiconductor manufacturing momentum.

Other findings

The U.S. share of the world’s chip manufacturing will increase to 14% by 2032, up from 10% in 2022. This will be the first time in decades the U.S. has grown its domestic chip manufacturing footprint compared to the rest of the world, SIA said.

If the CHIPS Act was not enacted, the SIA said U.S. semiconductor manufacturing would have slipped to 8% by 2032.

The U.S. will also lead the world in overall contribution to the global value chain including chip design, electronic design automation and semiconductor manufacturing equipment.

So far, the CHIPS Act has provided more than $29 billion in direct funding across seven companies — Intel, TSMC, Samsung, GlobalFoundries, Micron Technology, BAE and Microchip. The Act has also provided funding for various R&D projects and hubs across the U.S. for the expansion of engineer recruitment and semiconductor design.

Why it matters

Since COVID-19 pandemic in 2020, the U.S. has been looking to expand its domestic chip manufacturing after the current aggregation of chipmaking in Asia caused a major semiconductor shortage in the supply chain. This shortage led to numerous production issues with the automotive sector and other markets and put increased strain on the supply chain as companies had to source other avenues for semiconductors.

The U.S. is one of numerous regions that are looking to expand its domestic chip manufacturing as Europe, Japan, Canada and Asia are also all expanding for this reason as well as other reasons that have emerged due to the pandemic.

Other reasons for the expansion of domestic semiconductor manufacturing include:

  • Boosting national security
  • Boosting the national economy
  • Incentivize foreign investment in U.S. manufacturing
  • Incentivize R&D for next generation semiconductors
  • Promote stronger technological leadership in packaging and design
  • Grow the engineering workforce

“The CHIPS and Science Act has put America on course to significantly strengthen domestic semiconductor production and R&D, but more work is needed to finish the job,” said John Neuffer, SIA president and CEO. “We look forward to working with government leaders to advance policies that broaden the STEM talent pipeline, invest in scientific research, promote free trade and access to global markets, and expand and extend critical CHIPS incentives.”

To contact the author of this article, email PBrown@globalspec.com


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