Intel's chip factories aren't sufficient to secure a semiconductor supply chain in the United States

Intel's chip factories aren't sufficient to secure a semiconductor supply chain in the United States ...

Intel has announced that it will invest $20 billion in as many as eight chip factories in the United States on January 21. Our expectation is that this will become the largest silicon manufacturing location on the planet, said the company.

Intel's efforts are part of a larger push to reshore semiconductor manufacturing, which involves supply chain disruptions that.

Since July, Democrats and Republicans have been working toward a bill that would provide $52 billion in federal subsidies for the construction of new semiconductor factories in the United States. Ohio senators Rob Portman and Sherrod Brown, in a rare moment of bipartisan consensus, urged their congressional colleagues in to approve the subsidies quickly to alleviate an unprecedented shortage of semiconductors, exacerbated by foreign governments luring this sector abroad and US overreliance on overseas production.

US lawmakers are reportedly considering incorporating the measure into order to avoid a government shutdown.

But constructing a few high-tech semiconductor factories isn't enough to make America's chip supply independent from foreign manufacturing. For that, the US would have to reshore an, in addition to chip fabrication facilities, or fabs, like the ones Intel intends to build in Ohio.

So far, all Intel, Samsung, and TSMC have stated that their companies would build in the United States if the CHIPS Act were approved.

If you were only worried about supply security and manufacturing [semiconductors] locally so that automakers dont get cut off, then you should also look at outsourced assembly and tests, said Harvard Business School professor Willy Shih. You should be looking at all the materials that feed the foundries as well.

Chip factories are only part of the supply chain.

The most complicated and specialized part of semiconductor manufacturing is in multibillion-dollar chip manufacturing plants, like the ones Intel plans to build in Ohio. Dort, machines etch microscopic transistors into large, circular silicon wafers that might be a foot (.3 m) in diameter

The next step is sending those wafers off to testing and packaging companies. The machines examine each tiny transistor pattern to ensure they have been printed correctly. These transistors might measure as little as 10 millimeters across, roughly the width of a fingernail.

As a result, getting semiconductors ready for a car, a smartphone, or a washing machine depends on testing and packaging companies as well as high-tech enterprises.

In December, Intel announced its plans to build American chips in Malaysia.

Shih said: Alright, you're going to start your factory in Ohio, but youre still shipping chips to Vietnam or Malaysia for packaging, and then they've got to come back to the United States to be sold.

While it is important to fabricate chip wafers in US factories, Shih claims, citing the lack of confidence in the US.

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