The domestic industry is on high alert following Intel's announcement of the world's first mass production of cutting-edge 2-nanometer class semiconductors under the US government's semiconductor industry promotion policy, after facing a crisis of becoming a financially troubled company.

This achievement, surpassing South Korea's Samsung Electronics and Taiwan's TSMC, which have been confident in their semiconductor manufacturing capabilities, is expected to intensify the global semiconductor hegemony competition.

Intel logo. Reuters Yonhap News.

According to foreign media and industry sources on the 10th, the 18A process announced by Intel is analyzed to be 2-nanometer class, although specific circuit line widths have not been disclosed.

While Samsung Electronics and TSMC are also preparing for 2-nanometer mass production within the year, Intel, which had faced rumors of withdrawing from the foundry business due to severe financial difficulties, has taken the lead in commencing mass production of cutting-edge processes.

The domestic industry's prevailing sentiment is that for now, the true measure of success in the foundry business is proving technological prowess through actual orders rather than being the first to develop a process, and thus it remains to be seen how significant a threat this announcement poses.

An industry official stated, "Intel's market share is unlikely to surge immediately due to the 2-nanometer process," adding, "We need to observe the process of Intel building trust by securing customers and actually supplying volumes in the future."

There is a clear sense of vigilance regarding Intel's rapid normalization of its management, having undergone restructuring in workforce and business operations up until the first half of this year, only to outpace competitors with cutting-edge processes in a matter of months.

An industry official commented, "As Intel could re-emerge as a competitor, we must prepare for changes in the competitive landscape in various ways."

In particular, there are views that the market landscape could be shaken in the medium to long term, as this trend is not only driven by Intel's own self-help efforts but also by the US government's policy support and its collaboration with domestic big tech companies.

The Fab 52 facility in Arizona, where Intel has begun mass-producing 2-nanometer semiconductors, is the facility for which US President Joe Biden promised subsidies under the Semiconductor Act in March of last year.

Then-US President Trump meets with TSMC Chairman Mark Liu. EPA Yonhap News file photo.

Since the inauguration of the Trump administration, the US's semiconductor industry reshoring policy has accelerated.

Following a promise of nearly 150 trillion won in investment in the US from TSMC Chairman Mark Liu in March, then-US President Donald Trump stated at a press conference, "The most powerful artificial intelligence (AI) semiconductors in the world will be made in the United States," emphasizing, "This is a matter of economic security as well as national security."

Subsequently, the Trump administration announced a 100% tariff on semiconductors not produced domestically, and in the case of Intel, it secured a 10% stake by converting semiconductor subsidies into equity, thus becoming Intel's largest shareholder.

Under the US government's 'Save Intel' initiative, domestic big tech companies are also increasingly joining as allies.

Last month, Nvidia CEO Jensen Huang announced that Nvidia would invest approximately 7 trillion won in Intel and collaborate on the joint development of chips for PCs and data centers, stating, "We will be a very large customer for Intel's central processing units (CPUs)."

Intel has recently requested investment from Apple and exchanged opinions on collaboration, and it is also known that discussions are underway for Intel Foundry to manufacture AMD chips.

Under the full support of the US government and big tech, Intel's stock price has risen by more than 50% in approximately two months since August.

An industry official said, "From the US perspective, as Intel becomes a symbol of the US semiconductor renaissance, comprehensive support for Intel will continue," adding, "In a climate where the US is strengthening its nationalistic and protectionist policies, competition between our companies and the US company Intel could become even fiercer."

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