Federal Legislation Opens Opportunities for Investments in U.S. based Semiconductor Foundry Companies

Abstract

The article examines the bipartisan support for U.S. technology manufacturing under the U.S. CHIPS and Science Act and the earlier U.S. Innovation and Competition Act, which opens up a unique opportunity to invest in U.S. semiconductor and integrated device companies. Despite the high upfront costs and innovation risk factors inherent in the development of circuit manufacturing facilities, the recent federal prioritization of U.S. semiconductor manufacturing, combined with broader market demand for semiconductors and bipartisan support for over-reliance on Chinese manufacturing, pro-vides a unique offsetting risk for investment in semiconductor manufacturing facilities. To assess this risk, this note will present an analysis of the competitiveness of global and domestic semiconductor foundry companies and outline the likely implications of U.S. policy for the industry over the next five years