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The U.S. is bringing chip-making home

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https://www.mercurynews.com/2022/09/04/t...nia-ready/

EXCERPTS: Silicon Valley owes its success to the invention of a computer chip that is now made almost exclusively overseas. Can $52.7 billion lure the chip, the electronic heart of everything from cell phones to F-15 fighter jets, back home?

The CHIPS and Science Act, signed by President Biden in August, aims to inspire a manufacturing revival that is crucial to our national defense, economic security and future technical innovation.

Already, the domestic semiconductor industry is on a tear, with new megafactory construction underway in Arizona, Texas, New Mexico and soon Ohio reflecting manufacturers’ confidence that the U.S. will help pay for them.

[...] Fifty years ago, offshoring in Asia made sense. It reduced costs and helped U.S. companies stay competitive against international rivals. Those Asian countries invested in their factories. According to Micron, it is 35% to 45% cheaper to build a fab in a low-cost Asian nation than in the U.S., primarily because of government support.

Now, the most advanced chips are all made by the behemoth Taiwan Semiconductor Manufacturing Company, or TSMC. It’s the exclusive supplier of Apple’s silicon processors for iPhones and Mac PCs, as well as the manufacturing partner of other major U.S. companies like AMD, Broadcom and Qualcomm.

The U.S. is the largest consumer of chips in the world. But we make only 12% of what we use.

With growing U.S.-China tensions, government officials are worried. If taken by force, Taiwan’s factory would be rendered inoperable – and we’d lose the chips that power our economy and defense, according to the Center for Strategic and International Studies, a Washington D.C.-based nonprofit policy research organization that studies the future of national security.

The pandemic-related supply chain disruptions revealed the vulnerability, causing a chip shortage that adversely affected at least 170 industries, especially automakers.

Rebooting the American supply chain will also protect our future innovation, said electrical engineering professor H.-S. Philip Wong [...] “The semiconductor is foundational to many of the technologies that we are counting on going forward, including Artificial Intelligence, quantum computing, 5G and so on,” said Wong. “So to have American leadership,” he said, “you need to have leadership in semiconductors.”

[...] The CHIPS and Science Act aims to create a new world order. The $280 billion package includes $39 billion to help with the financing of semiconductor fabrication, assembly, testing and advanced packaging, as well as $13.2 billion toward research and workforce development. It also provides a 25% investment tax credit for capital costs of manufacturing equipment.

It’s not yet known how the funds will be spent. It’s up to the departments of Commerce, State and Defense to craft the details and decide how the money will be awarded.

Building a factory – where billions of microscopic transistors are squeezed onto ever-smaller computer chips – is a complex project... (MORE - missing details)
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