[News] CHIPS Act Repeal Could Slash U.S. Semiconductor Market Share to Single Digits

Recently, concerns have arisen that U.S. President Donald Trump might repeal the CHIPS and Science Act. According to a report from Liberty Times, citing Bloomberg, if the Trump administration revokes the CHIPS Act, the U.S. semiconductor market share could drop to single digits.

As noted in the Bloomberg report, the Washington-based Semiconductor Industry Association estimates that U.S. semiconductor manufacturing capacity is set to triple by 2032, increasing its global market share from 10% to 14%. However, without the CHIPS Act, the share would have likely dropped to 8% instead.

The report states that spending on semiconductor factory construction in the U.S. saw a significant surge in the months leading up to and following the passage of the CHIPS Act. Even companies that did not receive government subsidies have benefited from the overall growth of the U.S. semiconductor ecosystem, as the report highlights.

Additionally, the CHIPS Act offers a substantial 25% tax credit for manufacturing projects, which, according to the report, serves as the primary federal incentive for most businesses under the program. In contrast, grants typically cover only 10% to 15% of project costs, as the report notes.

Uncertainty Surrounding the Future of the CHIPS Act

Regarding the potential repeal of the CHIPS Act, the report points out that the terms of its contracts permit the government to delay payments or even reclaim funds under certain conditions.

According to the report, Commerce Secretary Howard Lutnick, who now supervises the implementation of the CHIPS Act, has yet to commit to upholding existing contracts and is currently reassessing planned investments.

Meanwhile, the report also highlights that even if Lutnick modifies specific agreements, the Trump administration remains legally required to use the funds designated by Congress for the CHIPS Act. As noted in the report, lawmakers have already allocated the full USD 39 billion in manufacturing incentives through fiscal year 2026.

Approximately 75% of the grant funding in CHIPS Act will be awarded to four leading producers of advanced semiconductors—Intel, TSMC, Samsung Electronics, and Micron—as highlighted by Bloomberg, with Intel being the largest recipient. However, Trump’s threat to abolish the CHIPS Act has raised concerns about the future of Intel’s planned new plants in Ohio, as noted by Economic Daily News.

TrendForce’s latest findings reveal that TSMC has announced it’s increasing investment in U.S. advanced semiconductor manufacturing, bringing the total to US$165 billion. Mass production is expected to begin after 2030 if the three newly planned fabs proceed on schedule. The U.S., which has been actively expanding its advanced semiconductor capacity, is projected to hold 22% of the global market share by 2030.

Read more

• [News] Trump Pushes to Scrap CHIPS Act, Jeopardizing TSMC Subsidies and Intel’s Ohio Plans
• U.S. to Hold Over 20% of Advanced Semiconductor Capacity by 2030, TSMC Expands Investment to US$165 Billion, Says TrendForce

(Photo credit: The White House)