Coronavirus, chip boom, and supply shortage: The new normal for global semiconductor manufacturing

Abstract

Over the past 50 years, the semiconductor industry has faced its fair share of difficult challenges. The COVID-19 pandemic the world is currently experiencing has caused the worst downturn since the financial crisis of 2008, devastating global economies. And yet, the semiconductor industry has repeatedly shown incredible resilience in the face of adversity. Despite the pandemic, the market has not experienced such a dramatic upturn since 2003 and as a result, the new market upturn breaks open the fundamental flaws and risks of manufacturing concentration and outsourcing. At a time when the world is precariously dependent on Taiwan for semiconductors, how can the global supply chain forecast, manage, and plan for such sudden shifts in the future? Now more than ever before, advanced technology companies need to keep the finger on the pulse of supply and demand to successfully inform their strategic manufacturing decisions and remain agile to ensure continuity of supply. As chip demand booms in the midst of a supply shortage over the coming months and supply is no longer a given, what does the future hold for manufacturing fabs? Will greenfield become the rule rather than the exception in this new normal? How will the market upturn impact global fab location choices? Reflecting on some 20 years of experience completing international semiconductor manufacturing asset transactions in North America, Europe, and Asia, ATREG Founder, President, and CEO Stephen M. Rothrock will provide insights into the current global manufacturing asset market and how it is likely to evolve as part of the current market upturn.