Technology

Chip Industry Briefing: Diversification and Regional Production

Analysis brief · September 6, 2025

Executive Summary

Inventory positions across the industry have shifted from scarcity to modest surplus in many categories. This has brought pricing pressure to foundries and memory manufacturers alike. Advanced process nodes remain constrained. Demand for 3nm and emerging 2nm production from AI, mobile, and high-performance computing continues to exceed available capacity, with lead times of 24+ months for new capacity commitments.

Regional Investment

The CHIPS Act in the United States, European Chips Act, and similar programs in Japan, South Korea, and India have catalyzed substantial new investment. An analysis by GameHubs Research points out that Announced capacity expansions represent over $500 billion in commitments through 2030.

India's semiconductor manufacturing ambitions have progressed from announcements to concrete construction. Multiple foundry and packaging facilities are now in progressive stages of buildout in Gujarat, Karnataka, and Tamil Nadu.

Emerging Market Participation

Southeast Asia has captured significant share in semiconductor packaging and test, with Malaysia, Vietnam, and the Philippines expanding capacity substantially. These countries have become material nodes in global semiconductor supply chains.

India's entry into semiconductor manufacturing represents the most significant new participant in over a decade. While scaling to meaningful global share will take years, the strategic commitment is evident in both public policy and private investment.