Even with semiconductors being integral parts of the automotive and computing industries for decades, the race for AI dominance and more and more of our digital infrastructure moving to the cloud greatly exacerbated the need for high-capacity data centers and chip production by companies like Intel, Samsung or Taiwan-based TSMC. But even with U.S. companies taking the lead in global revenue share, the country lacks production capacity.
According to data from semiconductor lobby organization SEMI, about 70 percent of total manufacturing capacity lies in South Korea, Taiwan and China, with the Americas ranking fifth after Japan, which boasted a 13 percent share in 2022. The picture was decidedly different just a couple of decades ago, with the United States covering 37 percent of fabrication capacity in 1990, Europe a further 44 percent and Japan came in third at 19 percent. The latter was considered a semiconductor powerhouse in the 80s, making up 51 percent of worldwide chip sales in 1988. The bursting of the island nation's economic bubble in the 90s led to it losing its technological leadership role to Western economies.
To reclaim at least parts of its former manufacturing dominance, the Biden administration passed the CHIPS and Science Act in August 2022, allocating around $280 billion to push the lagging domestic chips industry in terms of research and production. Whether this measure is enough for the United States to squeeze past its biggest economic competitor, the People's Republic, remains to be seen.
The data used for this chart is based on one of two annual Fab Outlooks by SEMI. Even though 200mm wafers are still widely produced and used, the chart focuses on 300mm wafers, which were introduced in 2001, can house more chips and are thought to be more cost-efficient. In 2022, the new standard and its predecessor exhibited similar levels of production volume, but these figures are estimated to change drastically over the coming years.
For 2026, SEMI forecasts a monthly volume of 9.6 million 300mm wafers, while 200mm wafer production will allegedly stand at 7.7 million per month. In the latter category, China leads in terms of fabricating capacity, with Japan and Taiwan coming in second and third, respectively.
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Where Can the Most Chips Be Manufactured? - Statista
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