chips act faces headwinds: global wafers flags implementation issues
washington, Friday, 21 February 2025.
global wafers, a major silicon wafer manufacturer, has expressed significant concerns regarding the us chips act implementation. the us chip program office is reportedly causing dissatisfaction. these issues could undermine the act’s effectiveness. the company’s unease highlights potential challenges in the rollout of the us government’s ambitious semiconductor incentive program. it also risks casting doubt on the appeal of the incentives for global manufacturers. global wafers is the world’s third-largest silicon wafer manufacturer.
market impact of global wafers’ concerns
Global Wafers’ apprehension could trigger a ripple effect across the semiconductor industry, potentially impacting investor confidence [GPT]. The company’s stock may face downward pressure as investors reassess the viability of U.S. expansion plans in light of these implementation challenges [GPT]. Competing firms might also experience volatility as the market digests the implications for the broader industry [GPT]. The extent of the impact will likely depend on how quickly and effectively the U.S. Chip Program Office addresses these concerns [GPT].
details of the dissatisfaction
Global Wafers indicated that the U.S. Chip Program Office is reviewing certain terms that are inconsistent with previous executive orders and policies [1]. This suggests a potential conflict between the current administration’s approach and established guidelines, creating uncertainty for companies seeking to capitalize on the Chips Act [1][GPT]. The specific nature of these terms remains unclear, but they appear significant enough to warrant a public expression of concern from a major industry player [alert! source 1 does not specify who’s policies are being reviewed, assuming Trump’s].
global wafers’ us expansion plans
Despite these concerns, Global Wafers remains committed to its globalization strategy, which includes building new facilities in the U.S. to supply silicon wafers for advanced processes, silicon photonics, and robotics [3]. This initiative, launched in 2022, aligns with the U.S. government’s objectives for the semiconductor industry [3]. However, the company’s commitment may be tested if the implementation issues are not resolved promptly, potentially leading to delays or modifications in its U.S. investment plans [GPT].
broader industry context
The semiconductor industry is currently navigating a complex landscape, with global silicon wafer revenue hitting $11.5 billion in 2024, a four-year low [5]. This decline underscores the importance of government incentives to stimulate growth and investment [5][GPT]. Meanwhile, other companies are making strategic moves, such as TSMC’s expansion of U.S. investments focusing on 2nm chips, supported by Chips Act subsidies [5]. NXP also acquired Edge AI NPU startup Kinara for $307 million, enhancing its AI platform [5]. These activities highlight the dynamic nature of the industry and the critical role of government support [5].
sic wafer market dynamics
GlobalWafers’ Chairman Doris Hsu recently noted that prices for 6-inch silicon carbide (SiC) wafers have stabilized, but a market rebound remains uncertain [3]. In 2024, an oversupply caused a sharp decline in global SiC industry prices, dropping over 50% below production costs [3]. This situation underscores the challenges facing wafer manufacturers and the need for a supportive regulatory environment [3][GPT]. Taiwanese manufacturers are shifting focus to developing 8-inch SiC wafers, anticipating a marked improvement by 2026 [3].