According to SIA, as of July 30, 2024, the CHIPS Program Office has announced over $30 billion in funding subsidies and over $25 billion in loans. These grants have been awarded to 14 companies, but five wafer fabs (Intel, GlobalFoundries, TSMC, Samsung, Micron Technology) account for the vast majority of the funding, and they have also received state and local subsidies.
The total investment of these projects will exceed 284 billion US dollars, with varying implementation times, some planned to be completed by 2025. Other wafer fabs will be completed within the next two to seven years. In addition, Texas Instruments is also applying for CHIPS Act funding for its planned wafer fabs located in Sherman, Texas and Leahy, Utah.
CHIPS funds may have had an impact on the site selection of some wafer fabs, and may have also advanced some of these investments by one or two years. Without CHIPS Act funding, TSMC and Samsung may not have established new wafer fabs in the United States. In addition, the impact of the Chip Act funding may not be significant in 2024, but it may increase capital expenditures in 2025.
The United States is not the only country subsidizing the semiconductor industry.
SIA estimates that the total semiconductor capital expenditure in 2024 will be $166 billion, a decrease of 2% from 2023. Electronics predicts that capital expenditures will increase by 11% in 2025, reaching $185 billion, surpassing the historical high of $182 billion in 2022.
Specifically, SK Hynix and Micron Technology plan to achieve double-digit capital expenditure growth in 2024, while Samsung expects a slight decrease in capital expenditure. SK Hynix and Micron expect a significant increase in capital expenditures by 2025, with SK Hynix growing by 75% and Micron growing by 47%.
TSMC plans to reduce capital expenditures by 3% in 2024 and increase capital expenditures by 10% in 2025. SMIC expects no change in capital expenditures in 2024, while UMC plans to increase by 10%. GlobalFoundries will reduce capital expenditures by 61% in 2024, but as it begins building a $11.6 billion wafer fab project in Malta, New York, capital expenditures are expected to increase significantly in 2025.
In addition, Intel expects capital expenditures to increase by 2% in 2024. Texas Instruments insists on its plan of an average capital expenditure of $5 billion over the next few years. STMicroelectronics and Infineon Technologies both plan to significantly increase their capital expenditures in 2023 before reducing them in 2024.
Electronics' forecast of an 11% increase in semiconductor capital expenditures by 2025 may be conservative, as plans from TSMC, Micron, and SK Hynix alone account for two-thirds of the $19 billion capital expenditure growth from 2024 to 2025.
As the company with the largest expenditure, Samsung may significantly increase its capital expenditure in 2025 to maintain its memory market share and increase its foundry business. SEMI's June 2024 forecast shows that spending on 300mm wafer fab equipment will increase by 17% in 2025, compared to a 6% increase in 2024. WSTS' forecast for June 2024 shows that the semiconductor market will grow by 16% in 2024 and 12.5% in 2025. And Electronics' upward forecast is that capital expenditures will increase by 20% by 2025.
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