U.S. will create at least two semiconductor manufacturing clusters by 2030, Commerce Secretary Gina Raimondo says

WASHINGTON — The U.S. will use funds from the $52 billion CHIPS and Science Act to create at least two large-scale logic fabs for the manufacture of semiconductors, along with multiple high-volume advanced packaging facilities, by 2030, Commerce Secretary Gina Raimondo announced Thursday.

Raimondo's announcement comes as the department prepares to open applications next week for businesses to receive funding under the CHIPS Act, signed into law by President Joe Biden in August.

"Each cluster will include a robust supplier ecosystem, R&D facilities to continuously innovate new process technologies, and specialized infrastructure," Raimondo told students at Georgetown University's School of Foreign Service. "Each of those clusters will employ thousands of workers in well-paying jobs."

U.S.-based manufacturing plants, known as "fabs," will produce advanced memory chips "on economically competitive terms," Raimondo said. The fabs will also help meet the need for current generation and mature-node chips "most critical to economic and national security," she added.

"These are the chips that go into cars, medical devices, and many of our defense capabilities," she added.

The CHIPS Act was established to increase U.S. competitiveness in the semiconductor market against manufacturing monopolies like Taiwan, which produces 92% of the world's leading-edge chips, according to Raimondo. The massive reliance on a single country for production exacerbated supply-chain problems during the pandemic, and generated national security concerns because any disruption to chip production can hinder the production of a range of goods.

"This is fundamentally a national security issue," she said. "As I said, CHIPS is about gaining a technological edge, export controls are about keeping it."

Raimondo also highlighted concerns about China's usage of semiconductors in its technological weapons systems. Taiwan's proximity to China — and the prospect of Chinese aggression against Taiwan — has also raised concerns within the Biden administration and Congress.

"Don't be naive about this, China ... (wants) the technology to improve their military capability, and export controls (are) narrowly defined or designed to make sure they don't get these chips to improve their military capability," Raimondo told Georgetown students.

The Commerce secretary reiterated the government's plans to invest $11 billion in what it calls a National Semiconductor Technology Center.

"The vision for it is an ambitious public-private partnership where government, industry, customers, suppliers, educational institutions, entrepreneurs, and investors converge to innovate, connect, and solve problems," Raimondo said of the center, which will actually comprise several locations around the country aimed at "solving the most impactful, relevant and universal R&D challenges in the industry," she added.

"Most importantly, the NSTC is going to ensure the U.S. leads the way in the next generation of semiconductor technologies—everything from quantum computing, materials science, and AI to the future applications we haven't even thought of yet," Raimondo said.