The Semiconductor Industry Association (SIA) predicts that U.S. semiconductor manufacturing capacity will more than triple by 2032. The Biden administration has targeted chipmakers Intel (INTC), Taiwan Semiconductor Manufacturing Company (TSM) and Samsung Electronics (005930.KS) in recent months.
SIA CEO and President John Neuffer joins Yahoo Finance's Akiko Fujita to discuss the expected growth of the chip manufacturing and foundry business through CHIPS Act private sector investments.
“It took decades to get to this point,” Neufer reveals. “The two big numbers that come out of this report, and I think the most interesting, is what the global manufacturing footprint would have been without the CHIPS Act, which would have been down to 8%. That's 14% with the CHIPS Act. That's almost twice as much.''It's going to take years to recover, but with the CHIPS Act and all these civilians. With the sector's investments, we are definitely turning a corner and heading in the right direction. ”
Neuffer roughly estimates that without activation of the CHIPS Act, the U.S. would be producing almost zero of the world's chips by 2032. “If we had the CHIPS method… we would be manufacturing 28% of those chips. It's like a fundamental change in the landscape.”
Neufer focused on China's own semiconductor infrastructure, characterizing the country's chip industry as “highly concentrated” in producing legacy chips. But it turns out that China's manufacturing tilt could create “overcapacity” for chips, leading to some downcycles for U.S. chipmakers.
Some world officials say China's manufacturing push, which boosts global competition in areas such as semiconductors and electric vehicles (EVs), will “resolve challenges” for the Chinese economy posed by weak consumer sentiment. We support the view that it is not something that can be done.
See more of Yahoo Finance's coverage of the 2024 Milken Institute Global Conference.
This post was written by luke carberry morgan.
