CEOs Call on Congress to Strengthen Semiconductor Research, Design and Manufacturing in United States

The Semiconductor Industry Association (SIA) today applauded a letter sent this morning to congressional leaders by a broad coalition of 59 CEOs and senior executives urging swift action to fund the CHIPS for America Act and enact a strengthened version of the FABS law to strengthen the United States. semiconductor research, design and manufacture. The signatories of the letter represent major sectors of the economy – including chips, automobiles, medical devices, technology, telecommunications, manufacturing and more – and millions of American workers.

Amid the current global chip shortage, the letter underscores the need to act on the CHIPS Act and the FABS Act to ensure that the United States is home to more semiconductor production and innovation, which will strengthen the US economy, national security and long-term supply chain resilience. term.

“Semiconductors are the backbone of our economy, our national security and our critical infrastructure. Full funding for the CHIPS Act and passage of a stronger FABS Act would provide a vital boost to semiconductor research, design and manufacture in the United States, while spurring the creation of jobs and making our chip supply chains more resilient for years to come, ”said John Neuffer. , President and CEO of SIA. “We applaud the actions taken today by CEOs from a range of critical industries, and urge Congress to prioritize these bipartisan initiatives across the finish line this year.”

The letter is the latest in a series of appeals from business leaders (including leaders in the semiconductor industry), US governors, members of Congress, national security experts and others in support of the US government’s action to strengthen domestic semiconductor research, design and manufacture.

Recognizing the critical role semiconductors play in America’s future, Congress enacted the CHIPS for America Act in January as part of the National Defense Authorization Act (NDAA) for fiscal year 2021. The law allows incentives for domestic semiconductor manufacturing and investment in chip research, but funding must be provided to make these arrangements a reality. On November 17, House of Representatives Speaker Nancy Pelosi (D-Calif.) And Senate Majority Leader Chuck Schumer (DN.Y.) announced an agreement to attend a conference on the law on Innovation and Competition (USICA), passed by the Senate, which includes $ 52 billion to fund the CHIPS Act.

The SIA is also supporting a semiconductor investment tax credit, as required by the FABS Act, to complement manufacturing incentives and research investments in the CHIPS Act. Congress is considering separate legislation containing an amended version of the FABS Act to provide an investment tax credit to incentivize semiconductor manufacturing in the United States. The SIA supports the extension of the tax credit to cover the design and manufacture of semiconductors.

Funding for the CHIPS Act, along with the enactment of a stronger FABS Act, are complementary efforts and will help improve the global competitiveness of the US semiconductor industry.

The share of global semiconductor manufacturing capacity in the United States has increased from 37 percent in 1990 to 12 percent today, according to a report by the SIA and the Boston Consulting Group (BCG). This decline is largely due to substantial incentives offered by the governments of our global competitors, placing the United States at a competitive disadvantage in attracting new semiconductor manufacturing facilities, or “fabs.” Additionally, federal investment in semiconductor research has remained stable as a percentage of GDP, while other governments have invested significantly in research initiatives to build their own semiconductor capabilities, and incentives Existing US taxes for R&D are lagging behind other countries. In addition, vulnerabilities in the global semiconductor supply chain have emerged in recent years and need to be addressed through government investments in chip manufacturing and research, according to a separate SIA-BCG study.