Micron Technology Inc.$Micron Technology(MU)$ is Idaho's largest for-profit employer, with about 6,000 workers in the Treasure Valley. Once primarily a memory-chip manufacturing site, the Boise headquarters is now the company's principal research and development center. More than 70% of the world’s supply of computer chips, including the most sophisticated ones, comes from Asia.
The United States, which produced 37% of the worldwide total in 1990, now has just 12% of the market. Commerce Secretary Gina Raimondo would like to change that, with incentives that would benefit Idaho’s high-tech industry. With chip shortages caused by the coronavirus pandemic and unrest brought by Russia’s invasion of Ukraine, concerns have been raised over whether a reliable supply of chips, used for cars, cell phones and electronics, will continue to be available for U.S. companies. In a call Wednesday with reporters from Idaho, Utah and Montana, Raimondo stressed the importance of having Congress pass incentives that would provide more than $52 billion for domestic computer chip manufacturing and research.
The implications for Idaho and the nation are striking, Raimondo said. “Obviously, Idaho is home to Micron, one of the largest employers in Idaho,” Raimondo said. “Micron is the only U.S.-based manufacturer of memory chips, and there are 50 more chip-making facilities across the state. So there is a great deal at stake for Idaho in this legislation.”
BOISE’S MICRON IS WORLD’S NO. 4 SEMICONDUCTOR MAKER
Micron Technology Inc., headquartered in Boise, has 6,000 workers in the Treasure Valley. It’s Idaho’s largest semiconductor company and the largest for-profit employer of Idahoans. Worldwide, Micron is the fourth-largest semiconductor manufacturer, second in the U.S. after Intel. And it’s the biggest U.S. maker of memory chips. Micron has chip manufacturing plants in Virginia, China, TW, Singapore, India, Malaysia and Japan, along with Europe.
It once produced chips in Boise, but ended production, except for design and testing, in 2009 and turned its Boise campus into the company’s principal R&D center. It sold its Lehi, Utah, plant to Texas Instruments in 2021. Micron Technology Inc. could receive federal incentives to manufacture computer chips in Idaho, under a bill under consideration by Congress. In addition, the Idaho Legislature has approved sales tax exemptions for chip companies to build or expand factories. Darin Oswald Idaho Statesman Last week, the Idaho Statesman reported on a bill passed into law by the Idaho Legislature that provides a sales tax exemption for building materials used to construct, expand, or modernize semiconductor plants in Idaho. Although the law, known as the Idaho Semiconductors for America Act, goes into effect July 1, it’s tied to passage of the incentives under consideration by Congress.
The Idaho Department of Commerce has been courting three companies for new or expansion projects. The companies involved have not been publicly identified, but the projects, if carried out, would involve a capital investment of more than $1.8 billion, according to the department.
The three projects could bring nearly 1,700 new jobs, according to Idaho Commerce. The largest would potentially add 1,474 new jobs with an investment of $1.8 billion. The smaller projects could bring 170 jobs with an investment of $24 million, and 50 jobs with construction costs of $12 million. Micron has not said whether it’s the company considering the $1.8 billion investment.
Last fall, Micron said it plans to invest more than $150 billion over the next 10 years to expand and update its memory-manufacturing capacity and to carry out research and development. It could include a possible expansion in the U.S., but President and CEO Sanjay Mehrotra did not say whether Boise is included in those plans. Micron’s sales are booming amid rising demand and the chip shortage. Two weeks ago, Micron reported quarterly revenue of $7.8 billion, up 25% from the same quarter a year ago.
Both chambers of Congress have passed bills that would provide the $52 billion for U.S. computer chip manufacturing, but differences in the two bills must be resolved before a unified bill can be finalized. “It will help America compete with China and also unleash the next generation of innovation in the United States,” Raimondo said. “It will also enable us to have stronger supply chains and have the semiconductors we need in order to make military equipment. “ The semiconductor shortage is “really at a crisis level,” said Raimondo, who has served as President Joe Biden’s commerce secretary since March 2021. Before that, she served as Rhode Island’s governor for six years.
CHIPS AVAILABLE FOR PRODUCTS IN U.S. ARE LIMITED
Five years ago, the computer chip inventory in the United States lasted about 40 days, she said. Today it’s fewer than five days. “Even more alarming, 90% of the world’s most sophisticated chips are made in TW actually a single company in TW,” Taiwan Semiconductor Manufacturing Co., she said. “It is those chips that we need for military equipment, artificial intelligence, quantum computing, communication devices, and they’re almost all made in Taiwan.”
Dependence on other countries for semiconductors means the United States is very vulnerable, she said. “So if there’s a COVID-19 outbreak, natural disaster or political instability that disrupts a foreign semiconductor facility, we feel it here in the United States,” she said.
A month ago, a major semiconductor supplier for Apple and Intel stopped production in Shenzhen, China, because of an increase in COVID-19 cases, Raimondo said. A major supplier of automotive chips suspended production at two plants in Japan after an earthquake. Tractor and agricultural equipment manufacturers in Montana had to temporarily halt production because of chip shortages. Reports indicate, Raimondo said, that Russia is running out of spare parts to repair tanks, airplanes, guided munitions and satellite equipment because of sanctions by the United States and other countries denying the country access to chips. “That should be a real wake-up call for us in America, because we’re also that vulnerable, because we’re so dependent on foreign manufacturers for our chips,” she said.
Last year, There experienced a severe drought that affected water needed for chip manufacturing before rains replenished the supply, he said. There was also a ship that got stuck in the Suez Canal last year that disrupted delivery of products. “You really need a resilient and diversified kind of multiple-source supply base,” Harrell said. “And obviously that starts with making the supply and having an adequate percentage of supply here in the U.S.”
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Micron will go higher