SIA President John Neufer at the ChipEx2020 Conference: Globalization is the Basis for the Chip Industry’s Success and Its Impact Is Dangerous to Industry

Neufer opened the plenum of the primary convention of the chip business in Israel, which takes place in digital format

“Globalization is the premise for the success of the chip business and its continued injury is harmful.” So says John Neufer, president and CEO of the USA Chip Business Affiliation (SIA). Neufer opened the ChipEx2020 Digital convention right this moment (Wednesday).

“My feedback right this moment will deal with among the nice challenges and alternatives that our business faces at a rare second and defines it in our historical past. A big a part of the work consists of collaboration with our colleagues within the world business for widespread pursuits and considerations, so we tremendously respect this chance to deepen our ties with the semiconductor business in Israel. ”

“Collaboration within the world business is extra necessary than ever given the distinctive and formidable challenges dealing with our business. These embody after all the rising tide of anti-globalism and financial and business fragmentation that may enhance innovation prices as Moore’s legislation approaches its bodily limits. In America we’re additionally dealing with a inflexible coverage fueled by deeply polarized politics forward of the upcoming elections, making the flexibility to advance insurance policies that strengthen our business more difficult. Though we’re additionally advancing on this necessary entrance on a regular basis. ”

“The primary problem for all of us right this moment particularly once we take part in digital occasions like that is the Covid-19 epidemic. When it began the plague threatened the provision and operation chains of the business and considerably decreased the demand downstream. Within the workplace right here in Washington DC. We began working remotely in early March and I doubt we are going to return to work from the workplace this yr. The market forecasts from February and March have principally predicted vital deep declines in world gross sales up to now, nonetheless our business has exceeded expectations and managed to deal with the storm fairly nicely. Demand for strong chips with world gross sales through the first half of the yr elevated by 6% in comparison with the identical interval final yr. A lot of this may be marked by the elevated demand for applied sciences that facilitate distance studying or distance studying. ”

“And naturally our greatest market China is again in enterprise. Backside line, though we’re definitely anxious in regards to the anticipated financial state of affairs, we’ve managed to carry up fairly nicely and transfer on to our subsequent problem – the tide of anti-globalization. As everyone knows, the worldwide semiconductor ecosystem is a posh and impartial community that thrives on worldwide cooperation and free data alternate throughout borders of concepts and folks. This actuality is what has made us so highly effective and progressive over the past 60 or 70 years. With out deep and environment friendly provide chains we’d not have had an opportunity to achieve a density of billions of transistors on one chip right this moment. Sadly, efforts are rising in capitals all over the world, together with in Washington, to maneuver away from globalization and break up economies. That is inflicting friction within the world buying and selling system. ”

“It is a coverage that stems from irrational concern. We oppose this risk of anti-globalization individually and collectively. With out limitless entry to our world provide chains our business will shrink considerably, as will the promise of all of the superb rising applied sciences similar to quantum computing of synthetic business and 5G and past. ”
“This leads me to a 3rd problem dealing with our business, the hovering prices of innovation that all of us face. Semiconductor corporations have pursued extra of Moore’s Legislation to ranges beforehand thought of inconceivable. However because the chips on chips proceed to shrink to spice up efficiency, the fee will increase and it’s troublesome to supply sustained innovation additionally will increase each when it comes to capital expenditure and R&D. Semiconductor corporations make investments about one-fifth of their income in R&D annually to assist meet this problem. That is near $ 40 billion in. 2019 As a consequence of these unprecedented investments and unparalleled sophistication in our business, I’m assured we are going to proceed to innovate at breathtaking speeds by way of the design of latest architectures and supplies, for instance. It is a problem that our business leaders deal with after all day by day. ”

“The final problem I wish to spotlight is the core of our work right here in Washington – the political panorama and coverage may be very troublesome and controversial in the USA in our nation’s capital as it’s in lots of different capitals all over the world. The talk is more and more militant and partisan. Apart from the final uncertainty cloud that it has created this hesitation has turn into more difficult the flexibility to advance insurance policies that strengthen the semiconductor business. On the plus facet, one of many initiatives that has garnered bipartisan help in Congress is an effort to speculate federal {dollars} in manufacturing and semiconductor R&D in the USA.
The USA lags far behind different nations in semiconductor manufacturing incentives and federal funding in chip analysis has remained on the similar degree as a share of GDP for many years. Because of this, chip manufacturing in the USA has steadily declined. Factories situated in the USA can at the moment produce solely 12 % of the semiconductors on the planet. Down from 37 % in 1990. The SIC requested the U.S. federal authorities to steadiness the land and incentivize U.S. chip manufacturing and considerably enhance federal funding and was submitted for analysis. I’m glad to report that there’s a bipartisan legislative effort to do exactly that, though there may be nonetheless a number of work to be finished till we attain the end line. ”
In conclusion, Neufer stated, “The chip business is an incredible business and the merchandise we produce assist information our nations and the world in these difficult instances. Whereas our business is made up of robust rivals, we’re united in creating and sustaining an ecosystem that promotes business progress and allows innovation. ”
“The semiconductor business carries a heavy burden. Numerous different industries Power Robotics Agriculture Transportation Well being depends upon it to flourish tremendously and enhance humanity. If we within the semiconductor business can keep our unimaginable tempo of innovation it is necessary that we’re closed inside ourselves in the case of our affect on the good applied sciences. The common particular person on the road doesn’t see them even know what a chip is or perceive the large energy of semiconductors. However we do and that is among the the reason why we’re right here right this moment to collaborate, share data and lead in direction of a imaginative and prescient of the longer term that yields nice issues for us and our youngsters. ”