Innovation Lightbulb: Global Investments in Chip Manufacturing
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In this week’s Innovation Lightbulb newsletter, we document announced global investments in chip fabrication plants (fabs) from the world's top three chipmakers: TSMC, Samsung, and Intel. These three companies combined have announced over $220 billion in investment in new and existing volume-manufacturing facilities since the start of 2021.* Let’s take a look at them:
Intel, the largest U.S. chip manufacturer, has committed to expanding its manufacturing footprint in the United States and Europe. In early 2021, it announced a $20 billion investment in two new chip facilities (Fab 52 and Fab 62) at its Ocotillo campus in Chandler, Arizona, which will manufacture Intel’s most advanced semiconductors including the Intel 20A, and which are planned to begin operations in 2024. In 2022, Intel announced another $20 billion investment in two leading-edge fabs in New Albany, Ohio, to come online by 2025 at a new campus which Intel claims may eventually accommodate up to eight new fabs.
In Europe, Intel has also committed to expanding existing manufacturing operations in Leixlip, Ireland—currently its largest such operations outside the United States. Its announced 17 billion euro initial investment in a “Silicon Junction” manufacturing complex in Magdeburg, Germany, has drawn even more attention, promising two new leading-edge fabs by 2027—the first of their kind in Europe.
In 2020, Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest chipmaker, announced an initial $12 billion investment for a 5-nanometer fab in Arizona, an investment which was expanded to $40 billion and two fabs in late 2022. The fabs, when completed, will be TSMC’s first manufacturing facilities built on U.S. soil since the 1990s and will be its first leading-edge fabs there.
TSMC, in cooperation with Japanese firms Sony and Denso, also announced a roughly $8 billion investment in its first manufacturing operation in Japan outside Kumamoto. A second fab in Japan worth around $7.4 billion (not shown on map) is reportedly being considered and may produce higher-node chips at the 5- and 10-nanometer process.
In Taiwan, TSMC also broke ground on a 28-nanometer chip facility in the southern city of Kaohsiung after announcing the indefinite postponement of a 7-nanometer fab’s construction at the same site. The cost of the new facility, set to begin production in 2024, was undisclosed.
In 2021, the world’s largest and most advanced memory chip manufacturer, Samsung Electronics, announced a $17 billion dollar investment in a new fab in Taylor, Texas, just up the road from its existing facilities in Austin, Texas. The new operation will be Samsung’s second manufacturing operation in the United States. The firm’s other investments are concentrated in Asia, which includes two ~$40 billion expansions of its massive Pyeongtaek campus in Korea and another $11 billion upgrade to its existing facility in Xi’An, China.
In February 2023, the U.S. launched its first CHIPS Act funding opportunity for applicants seeking to complete projects involving the construction, expansion, or modernization of commercial semiconductor fabrication facilities with a total of $39 billion in subsidies available. Meanwhile, the EU Parliament and the 27 EU member states reached a provisional agreement on their own Chips Act in April 2023, hoping to stimulate 43 billion euros in public and private investment in the European chip industry.
As economies around the world begin to implement ambitious chip subsidy programs, competition for new investments from these firms and others will intensify.
This map is not inclusive of packaging or R&D facilities. Only volume wafer fabrication plants are shown.
Data visualization by Jaehyun Han