U.S. Semiconductor Renaissance: All the Upcoming Fabs

The U.S. share of global semiconductor manufacturing capacity has decreased from 37% in 1990 to 12% in 2021, according to the Semiconductor Industry Association (SIA), but some 47% of the chips sold worldwide are designed in the U.S. This disparity poses major risks to American national security and the economy, which is why both industry insiders and politicians recently began to call for building semiconductor fabs in the USA.

Their calls have been heard, and today five major chipmakers — GlobalFoundries, Intel, Samsung Foundry, TSMC, and Texas Instruments — are building new semiconductor production facilities in the U.S. These efforts will inevitably be bolstered by a new wave of funding provided by the newly-approved CHIPS act. This U.S. subsidy initiative will pump $52 billion into new US-based chip fabs and provide fresh tax incentives. Those funds will spur a wave of new investment over the coming years, and its sorely needed.

Semiconductors

(Image credit: Tom’s Hardware)
There are many reasons why countries like Taiwan, South Korea, and Singapore became leading producers of logic and memory chips in the 1990s and 2000s. In addition to lower labor costs in these states, those governments and their local authorities provided various incentives to chipmakers, which is why it was significantly cheaper to build fabs in Asia than in the U.S. and Europe.

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New York and Saratoga County authorities understood this early and offered AMD significant incentives in 2006 when the company made plans for what is now known as GlobalFoundries Fab 8. Unfortunately, other states and the federal government weren’t that agile, which is why the deployment of brand-new fabs became a rare occurrence in America. In fact, Intel even adjusted its manufacturing capacity strategy, culminating in it delaying the Fab 42 equipment move in by five years and its coming online by six years.

While we can’t say that the semiconductor production industry in the U.S. didn’t add capacity in recent years — both Intel and GlobalFoundries gradually expanded their production capacities in the late 2010s — brand-new leading-edge fabs haven’t been deployed in the U.S. for a while. That’s about to change. Here’s how and where those changes will take place.

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