(image via Pixabay)
What are the semiconductor folks up to these days? I'm glad you asked! On Tuesday, Joe Biden visited a Taiwan Semiconductor Manufacturing Company (TSMC) site in Phoenix, mentioning new jobs as the manufacturer plans to build a second semiconductor factory and increase its investment from $12 billion to $40 billion.
"American manufacturing is back, folks," Biden said at the event. "These are the most advanced semiconductor chips on the planet, chips that will power iPhones and MacBooks, as Tim Cook can attest … It could be a game changer."
TSMC is already constructing a $12 billion factory in Arizona to manufacture 5-nanometer and 4-nanometer chips. This one will start mass-producing chips in 2024. The company says these two factories will introduce thousands of high-paying tech jobs and produce 600,000 wafers per year. Meanwhile, constructing the second factory is set to begin in the coming year, with production starting in 2026. This factory is expected to manufacture 3-nanometer chips.
The Chips and Science Act of 2022 was approved in August, a bill that includes $52.7 billion for U.S. semiconductor companies to focus on research and development along with manufacturing and workforce development. Recently, TMSC started developing 3-nanometer chips and Taiwan.
According to a Semiconductor Industry Association (SIA) report, the United States should invest an additional $20 billion - $30 billion toward designing, researching, and developing semiconductors through 2030. This would, of course, be in addition to the $52 billion investment that Congress approved. The report also says that the American share of design revenues is diminishing, decreasing from over 50% in 2015 to 46% in 2020.
Failure to invest more in the public chip design sector could cause those design-share revenues to drop to 36% by the end of 2030. In addition, the report says that private-sector chip design research and development investments are more common than in other regions and public investments account for 13% of the nation's total spending. This means the U.S. is behind Europe, China, Japan, Taiwan, and South Korea, who average 30% of public investments.
The report suggests that investing $30 billion in the private chip design sector over eight years, with $20 billion in tax incentives, could lead to $450 billion in design sales over the next ten years while supporting 23,000 new design jobs. With Apple stating they plan to buy from US-based manufacturing, this is a massive step in the right direction.
Have a story tip? Message me at: http://twitter.com/Cabe_Atwell