Government incentives and the competitiveness of us semiconductor manufacturing industry From Boston Consulting
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The following is the Government incentives and the competitiveness of us semiconductor manufacturing industry From Boston Consulting recommended by recordtrend.com. And this article belongs to the classification: Boston Consulting, research report, Hardware equipment industry.
BCG released a new report “government incentives and competitiveness of us semiconductor manufacturing industry”. In the era of digital transformation, artificial intelligence and 5g communication, semiconductor industry is very important to economic competitiveness and national security.
The United States has long been a leader in the global semiconductor industry, accounting for 45% to 50% of global revenue. However, the US share of semiconductor manufacturing capacity has dropped from 37% in 1990 to 12% now. In addition, the United States accounts for only 6% of the world’s new capacity under development. In contrast, China is expected to increase about 40% of its new capacity in the next decade and become the world’s largest semiconductor manufacturing base.
The United States has a number of key factors at the top in choosing the location of the front-end manufacturing facility (FAB), such as synergies with existing footprints and ecosystems, access to skilled personnel, and intellectual property protection. However, the cost of building a new factory in the United States is ten higher than that in Taiwan, Korea or Singapore, which is 30% higher than that in mainland China, which is 37%-50% higher than that in Chinese mainland. Considering the ten year cost of a most advanced plant, including initial investment and annual operating cost, it is a huge gap between 10 billion -400 and $10 billion. Up to 40% – 70% of the cost difference is directly attributable to government incentives.
Global manufacturing capacity is expected to grow by more than 50% from 2020 to 2030, providing a market opportunity for the United States to attract a higher share of chip manufacturing plants. A $20 billion to $50 billion federal government plan to provide additional grants and tax incentives for new state-of-the-art chip factories in the next decade will effectively reverse the downward trend of the U.S. semiconductor manufacturing industry in the past 30 years.
Under the plan, the United States may double or triple its foreign semiconductor manufacturing capacity to meet the expected growth in market demand, from the current 6% to 14% – 24%.
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