The Intelligence from The Economist Trust the processor: America’s CHIPS Act one year on
Aug 9, 2023
Shailesh Chitnis, a business writer for The Economist, and Avantika Chokoti, an international reporter, tackle the impact of the CHIPS Act on U.S. semiconductor manufacturing. They discuss the challenges of boosting domestic production, especially against Asian competition. The conversation shifts to Britain's fading reputation in foreign aid, examining the controversial merger of key agencies and its effects on transparent aid delivery. Finally, they touch on innovative sound designs in electric vehicles aimed at enhancing safety and driving experience.
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CHIPS Act Reshaping US Semiconductor Landscape
- The CHIPS Act aims to boost US semiconductor manufacturing, shifting from a design-focused role to increased production.
- By 2025, the US is projected to have 18% of global leading-edge chip capacity, a significant increase from its current near-zero share.
TSMC's Arizona Fab Challenges
- TSMC's Arizona fabs face delays and cost overruns, pushing completion from 2024 to 2025.
- Labor shortages, including skilled workers and semiconductor experience, contribute to the challenges.
Higher US Fab Costs
- US fab construction costs are 30-40% higher than in Asia, mainly due to increased labor costs.
- Operating costs also run 30-35% higher in the US compared to Taiwan.