CHIPS Act Fuels Innovation in US Semiconductor Manufacturing

The CHIPS Act Fuels Innovation in American Semiconductor Manufacturing

By The Fatty Fish Editorial Team - April 4, 2023

From the time the CHIPS Act was introduced in the Spring 2020 through its enactment, companies in the semiconductor ecosystem have announced dozens of projects to increase manufacturing capacity in the U.S. Some projects began in anticipation of CHIPS Act funding, while others moved forward following enactment of the legislation. The following list highlights announcements spurred by the CHIPS Act:

Over 50 new semiconductor ecosystem projects were announced across the U.S., including the construction of new semiconductor manufacturing facilities (fabs), expansions of existing sites, and investment in facilities that supply the materials and equipment used in chip manufacturing.
Over $210 billion in private investments to increase domestic manufacturing capacity were announced across 20 states.
As part of the new projects, 44,000 new high-quality jobs were announced in the semiconductor ecosystem.

These new projects cover a range of activities needed to bolster the U.S. chip ecosystem, including new, expanded, or upgraded fabs in various semiconductor segments (e.g., advanced logic, memory, analog, and legacy chips), semiconductor equipment facilities, and facilities to produce key materials used in the chip manufacturing process.

The announced projects include the construction of 23 new chip fabs and the expansions of nine fabs. Increased fab construction spurs investment by suppliers of materials, chemicals, and equipment. As a result, companies that supply semiconductor manufacturing equipment and the materials used in chip production have announced plans to invest in several facilities to support increased domestic manufacturing capacity. Here are a series of opinion pieces we found of interest regarding considerations for the CHIPS Act.

America’s $52 Billion Bet on the Chips Race Can’t Succeed without Small-Business Innovation

In an opinion piece for Fortune, “America’s $52 billion bet on the chips race can’t succeed without small-business innovation” Robert Morcos, founder and CEO of Social Mobile, discusses the significance of semiconductors for small business innovation and highlights the U.S. substantial investment in chip manufacturing as a strategic move to enhance national security, economic resilience, and technological leadership.

Morcos emphasizes how semiconductors have become the foundation of technological advancements, enabling innovations in various sectors, including artificial intelligence, 5G networks, and electric vehicles. With the recent shortage of semiconductors, the vulnerabilities and dependencies of global supply chains have prompted governments to invest heavily in domestic chip production. The $52 billion investment will be used to bolster the manufacturing capacity of domestic chipmakers, thereby reducing the reliance on foreign suppliers. He argues that the complex challenge of continuously innovating to reach chip dominance will require “intellectual agility and the ability to nimbly test and reiterate,” which are strong capabilities of small businesses. Read the full article on Fortune.

The Chip Industry’s Little-Known Global Assembly Line

In an opinion piece for The Hill, “The chip industry’s little-known global assembly line,” Lenny Siegel, former mayor of Mountain View, California, and executive director of the Center for Public Environmental Oversight, discusses the complex and interconnected nature of the global semiconductor industry. He highlights the various stages involved in the production of computer chips and the global network of companies and countries that contribute to the process.

Siegel describes the various stages of chip production, including design, fabrication, assembly, and testing. Each of these stages can involve different companies and countries, each specializing in specific aspects of the process. For example, chip design might take place in the U.S. or Europe, fabrication could occur in Taiwan or South Korea, and assembly and testing might happen in countries such as China or Malaysia.

He also emphasizes the potential risks and vulnerabilities associated with such a global supply chain. Geopolitical tensions, trade disputes, and natural disasters can disrupt the production and supply of chips, affecting various industries and economies worldwide. Read the full article on The Hill.

Disclosure: Fatty Fish is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.

The Fatty Fish Editorial Team

The Fatty Fish Editorial Team includes a diverse group of industry analysts, researchers, and advisors who spend most of their days diving into the most important topics impacting the future of the technology sector. Our team focuses on the potential impact of tech-related IP policy, legislation, regulation, and litigation, along with critical global and geostrategic trends — and delivers content that makes it easier for journalists, lobbyists, and policy makers to understand these issues.