The Peter Zeihan Podcast Series Where Would I Put a US Semiconductor Fab? || Peter Zeihan
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Dec 8, 2025 What factors should influence the location of a US semiconductor fabrication facility? The discussion reveals that fabs are part of a massive supply chain with crucial design work staying in the U.S. However, challenges arise with foreign subsidies impacting local fabs. Peter highlights the need for a skilled, adaptable workforce for downstream processes. He evaluates unsuitable cities, and points to Arizona's struggles with TSMC. Ultimately, he suggests the Midwest as the prime location due to its workforce and infrastructure, while warning of cost challenges.
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Fabs Are One Part Of A Huge Chain
- Fabs are one part of a vast semiconductor supply chain with tens of thousands of steps and thousands of companies.
- The fab itself is mid-value and mid-employment compared with extensive downstream processing and assembly.
Most Work Happens After The Fab
- The fab process ends with wafers that must be diced, tested, stacked, and packaged elsewhere.
- Over an order of magnitude more labor and capital is needed after the fab than to build and run the fab itself.
Subsidies Shifted Fab Geography
- The U.S. ceded fabs to Korea and Taiwan because those countries subsidized the industry heavily.
- Bringing fabs back won't solve the harder problem of rebuilding the extensive downstream ecosystem.