Chipmakers Race to Build Factories Amidst Shortages

By: SiliconExpert on November 5th, 2021

Relief to the chip shortage is coming – but how soon?

Electronics chip makers have shifted gears in an attempt to combat the global chip shortages. Top manufacturers, such as TSMC and Samsung, are looking to invest tens of billions of dollars into building new chip fabrication plants.

How will this strategy of expansion during a shortage turn out in the long run? How quickly can we expect the chip shortage to be relieved? Experts and analysts predict that supply will be tight well into 2022. It may not be until 2023 that supply chains return to normal. Already, companies like Apple are reallocating their existing supply of chips into different products to meet revenue goals.

What’s causing the shortage and which companies are expanding

The global chip shortage remains one of the biggest stories in investment in 2021. Caused by skyrocketing demand for electronics goods, the shortage is exacerbated by disruptions in production, such as natural disasters, tariffs, and regulations. 

Major chipmakers have shifted strategies by looking to invest in constructing new manufacturing plants. Taiwan Semiconductor Manufacturing, Samsung, Intel, SMIC, Micron, SUMCO, and GlobalFoundries have all announced new construction investments totaling billions of dollars (USD). 

Information like this is crucial to supply chain managers for large electronics manufacturers. Knowing when the new chip factories are complete and purchasing part order deals at the right time can have a massive impact on lowering costs and increasing profit margins.

List of major global chipmaker expansion plans

We’re providing a complete list of the major global chipmaker’s plans for expansion and giving the most updated timeline. Especially with the uncertainty of global trade regulations, major expansion plans will not only reduce shortages in the future but lower prices and tariffs by giving every OEM manufacturer options on every continent.

Chip ManufacturerDetailsInvestmentConstruction Start DateEstimated CompletionNew Location
Taiwan Semiconductor Manufacturing (TSMC) TSMC the world’s top contract chipmaker commenced construction on a $12 billion manufacturing complex in Arizona in July 2021. Once complete in 2024, the site will be mass-producing chipsets using a cutting-edge 5nm node. The firm also envisions building up to six fabs in the American Southwest over the next 10 to 15 years. Also, TSMC announced plans to build a new plant in Japan next year to produce 22nm and 28nm chips in its latest effort to expand its global manufacturing footprint. The Japanese fab is to start operations in 2024. $12 BillionJuly 20212024Phoenix, Arizona, USA & Japan
SamsungSamsung plans to spend $17 billion to significantly expand the production capacity of its Austin, Texas, chip factory. It wants to upgrade the site’s technology by equipping it with state-of-the-art extreme ultraviolet lithography machines. The conglomerate is also interested in launching a factory in Arizona, with construction wrapping up in 2024. $17 BillionSeptember 20212024Taylor, Texas, USA
IntelIntel the world’s foremost IDM hopes to reassert its semiconductor industry supremacy by greatly expanding its U.S. footprint. The corporation declared it would invest $20 billion to build two new fabs with 7nm manufacturing capability in Arizona. It also aims to break into the foundry services market by using its resources to make chips for other companies. $20 BillionSeptember 20212025Chandler, Arizona, USA
Semiconductor Manufacturing International Corporation (SMIC) SMIC, China’s largest pure-play foundry, announced in September 2021 its plans to invest $8.9 billion in a new Shanghai-based fab for 12-inch (300mm) wafers. When completed, the new fab is expected to provide more than 100,000 wafer starts per month. This volume would represent a sizable bump in manufacturing capacity. $8.9 BillionAnnounced September 2021TBAShanghai, China
Micron Technology U.S. memory chip maker Micron Technology Inc. will build a new DRAM chips factory at its Japanese production site in Hiroshima at $7.0 billion, with production set to begin in 2024. $7 BillionAnnounced October 20212024Hiroshima, Japan
SUMCO Corporation  Sumco Corp., a global maker of semiconductor wafers based in Japan, announced a plan to spend 228.7 billion yen ($2.1 billion) to raise 12-inch wafer production lines. The company plans to start mass production in 2023 and operate all the lines in 2025. $2.1 BillionAnnounced September 20212024Imari, Saga Prefecture, Japan
GlobalFoundries GF, the largest U.S.-based contract chipmaker, announced it would put $1 billion toward opening a new fab. The project, funded in conjunction with the American government, will enable its New York factory to increase its output by 150,000 wafers annually. The manufacturing plant upgrade will feature mature nodes dedicated to making automotive and 5G components in the future. $1 BillionAnnounced July 2021TBAMalta, New York, USA
SK Siltron SK Siltron, a global maker of semiconductor wafers based in South Korea, decided to focus more on quality than quantity. The silicon wafer affiliate of SK Group plans to build a $300 million silicon carbide plant in Michigan, the US, and a 12-inch epitaxial wafer facility in South Korea. Both are expensive wafers for high-tech semiconductors. $300 MillionAnnounced July 20212024Bay City, Michigan, USA
Simmtech South Korea-headquartered Simmtech a manufacturer of high-layer PCBs for semiconductors, is looking to expand with a new factory in Malaysia via Malaysian subsidiary Sustio, invest $120 million in “Phase-1” of the project, which will see the operation at the new factory start in the first quarter of 2022. $120 MillionJuly 20212022Penang, Malaysia
Kyocera Kyocera Corporation says it will invest $97 million to construct two additional production facilities at its Kokubu Plant Campus in Kagoshima, Japan. The new facilities will double the campus’ production capacity for fine ceramic components used in semiconductor manufacturing equipment while securing space for other manufacturing as Kyocera’s business expands. Construction of the two plants is scheduled to start in November 2021, with a plan to begin production at the 1st plant in October 2022, and at the 2nd plant in October 2023. $97 MillionNovember 20212022Kagoshima, Japan

Once construction completes on these new fabrication plants, supply would be able to meet current demand for chips. It remains to be seen if chip demand will continue to scale into the future, but as of now, these new expansions show promising opportunity for OEM manufacturers around the world. 

Want to follow personalized news in supply chain?

Our new supply chain module sends automated alerts customized to each users’ industry and product, allowing them access to a wide range of industry-impacting news. This helps immensely in risk-forecasting, so customers can route their supply chain to meet production numbers and demand. Currently, risk scores for parts produced in Asia are at an all-time high-risk rating, so expansion news points to a future of not only more production and inventory options, but lower prices as well. 

To learn more about our Supply Chain Risk Management tool, please visit If you’d like a demo, please contact your local SiliconExpert support agent, or contact us below.

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