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Chip production in the U.S.: a proposal from the authorities to stimulate the industry
The U.S. government is considering options that would increase chip production. One of the proposals in this matter is the introduction of incentives for investment in the segment.
It should be noted that at the end of 2020 there was a shortage of semiconductor products in the global market. First of all, automobile manufacturers suffered from the shortage of chips, including such giants as Toyota, Volkswagen, General Motors, Honda and others. They had to reduce the volume of production. In addition, the shortage of chips had a negative impact on the electronics manufacturers, such as Samsung and Xiaomi. Experts call the pandemic and its consequences the main reason for the shortage of semiconductors. During it a large number of people moved to a remote format of work, resulting in a significantly increased demand for computer equipment and communications devices. Many chip makers had to urgently reorient their processes to meet this need. As a consequence, other semiconductor consumers found themselves in cramped conditions, as production volumes for them decreased. Among them were automobile concerns.
In turn, the Chinese corporation Huawei and Taiwan’s TSMC, which is the largest manufacturer of chips, said that the shortage is associated with sanctions from the U.S.. Several years ago, the U.S. government restricted the activities of high-tech companies from China, which included Huawei and ZTE. The imposition of sanctions led to the fact that these corporations began to stockpile microchips for their products, actively buying them up on the global market. In addition, competition in the segment has increased, and other manufacturers have also increased the volume of chip purchases.
To improve the situation, a number of companies which are engaged in chip development and production have announced a major investment in the development and expansion of capacity. Understanding the seriousness of the problem, many countries have also decided to introduce programs to stimulate the industry. For example, in the European Union, the United States and China there are projects to build new plants for the production of semiconductors. The authorities hope that such initiatives will reduce the dependence of local companies on imported supplies.
Politicians in the U.S. have sent to Parliament a law that provides tax incentives for investments in the semiconductor segment. Their size should be 25%. Prior to this, the government has already allocated $52 billion to support the industry. According to politicians, these programs should promote the construction of factories in the U.S., which will not only provide the local market with enough chips, but also create jobs for Americans. It should be noted that TSMC is already building its factory in Arizona.