Executive Order Could Lead to New Semiconductor Factory Construction

In an effort to strengthen weak links in the supply chain, President Biden has issued an executive order calling for a 100-day review on how to make the production of semiconductor chips more prevalent in the U.S.

The order comes in the wake of a series of reports indicating that both the semiconductor supply chain, relying as it does on other countries, is not reliable.

With most of the world’s semiconductor manufacturing based in both China and Taiwan, a number of high tech and medical field companies in the U.S. have seen their services interrupted due to pandemic-caused delays in the global supply chain.

Even more, according to a recent report issued by the Semiconductor Industry Association, the ongoing impact of Covid 19 on the supply chain remains a cause for “significant near-term market uncertainty.”

In a subsequent statement, the association has urged both Biden and Congress to “invest ambitiously in domestic chip manufacturing and research.”

In response, the President has called for allocating up to $37 billion in funds to help boost chip manufacturing in the U.S.

Funding for such efforts was inserted into the recent National Defense Authorization Act, but requires a separate appropriations process to be released.

Analysts say last fall’s announcement that the Taiwan Semiconductor Manufacturing Company is planning to build a $12 billion semiconductor plant in Arizona is a step in the right direction.

The construction of similar facilities, notes the Semiconductor Industry Association, “will ensure more of the chips our country needs are produced on U.S. shores,” while also supporting the country’s critical infrastructure.
​
Biden has promised to act quickly once the 100-day review is completed.

​By Garry Boulard

---