A current update Within the Semiconductor Industry between US and China

The US Department of Commerce is initiating a survey of the semiconductor supply chain and defence industrial base to address national security concerns stemming from Chinese-sourced chips, aligning with a plan to allocate nearly $40 billion in subsidies for semiconductor chip manufacturing. The survey, starting in January, specifically focuses on how US companies source “legacy chips,” including current-generation and mature-node semiconductors. The primary goal is to mitigate national security risks associated with Chinese-manufactured legacy chips in critical US industries.

China’s significant subsidies, estimated at $150 billion over the past decade, have raised concerns about an “unlevel global playing field,” according to a report from the Commerce Department. Commerce Secretary Gina Raimondo expressed worry about China’s practices, noting signs of efforts to expand legacy chip production and hinder the competitiveness of US companies. The survey is positioned to address these challenges and promote a more level playing field for legacy chip production.

Looking ahead, Raimondo anticipates multiple semiconductor funding awards within the next year, including significant announcements that could reshape US chip production. The Commerce Department’s report highlights the challenges US-based semiconductor companies face, emphasizing the need for long-term support for domestic semiconductor fabrication construction and permanent provisions incentivizing steady construction and modernization. In summary, the US Department of Commerce’s proactive measures underscore the critical importance of securing the nation’s semiconductor supply chain amidst growing challenges and global competition.