Intel CEO Pat Gelsinger thinks it's well past high time to get more of the semiconductor supply chain back in the United States as a means to protect national security interests.
"Absolutely, right? Yeah, this is an unquestioned issue," said Gelsinger at Yahoo Finance's All Markets Summit, when asked if too much chip production in the hands of overseas players is a national security risk.
The lead players in chip production continues to be Taiwan's Taiwan Semiconductor and South Korea's Samsung Electronics. Combined, both control more than 70% of the semiconductor manufacturing market. And they stand to get even more powerful in the years ahead if they go unchecked by U.S. chip stalwarts.
Taiwan Semiconductor has said it would invest $100 billion over three years to boost production capacity. Samsung is aiming to increase its investments in production capacity by more than one-third looking out to 2024.
"I think everybody was somewhat lulled into sleep on the efficiency, the cost benefits of supply chains [being overseas] versus the resilience and the national security of the supply chain," Gelsinger explained. "And I think that is one of the great wake-up calls that has resulted from COVID. Everybody is now starting to realize the precarity of the current situation."
Intel committed itself to making chips for other companies in a bid to increase industry capacity back in March. As part of that ambition, Intel recently broke ground on two chip making foundries in Arizona that are projected to cost $20 billion. Intel expects both plants — dubbed Fab 52 and Fab 62 — to be completed by 2024.
The company has teased it could spend billions of dollars more over the next decade to regain market share in chip production.
The industry's biggest players are now waiting for the U.S. government to do its part and pass the $52 billion CHIPS for America Act. In June, the Senate signed off on the CHIPS Act — which aims to incentivize U.S. manufacturing of semiconductors. But, the bill is still being debated in the House of Representatives.
"We would just call on everybody and say let's get these things done. Let's build back much more rapidly. It's time for us to change the arc of how the industry looks. As we go into the second half of this decade, we all feel confident," Gelsinger added.