U.S. Quantum Ambitions Face a Supply Chain Test, Policy Analysts Warn

Insider Brief

• Analysts at the Foundation for American Innovation recommend coordinated U.S. investment in quantum components and manufacturing capacity to support commercialization and reduce supply chain vulnerabilities.
• The analysis identifies limited access to essential inputs, competition from AI infrastructure demand, fragmented government coordination and unstable federal funding as key obstacles.
• Recommendations include advance purchase commitments, targeted manufacturing investments, shared supply chain information and clearer federal plans to buy quantum computing systems.
• Image: Photo by Karine Avetisyan on Unsplash

U.S. quantum ambitions could outpace the supply chains needed to turn laboratory advances into a commercial industry, four policy analysts warn.

In a policy piece published by the Foundation for American Innovation, Joshua Levine, Prineha Narang, Jacqueline Tame and Alexandra Seymour Gabel, write that Washington must invest in the components and manufacturing capacity behind quantum technologies while supporting efforts to build useful machines.

The stakes extend beyond the race to produce an early quantum computer capable of scientifically relevant calculations. The analysts say investment decisions over the next two to five years will help determine who controls the design and large-scale production of essential components, from specialized refrigeration equipment to lasers and control electronics.

Their recommendations include government-backed purchase commitments, targeted manufacturing investments, broader sharing of supply chain information and clearer federal plans to buy quantum computers.

The analysis draws on a roundtable co-hosted by FAI and investment firm Playground Global with participants from industry, government and civil society.

“One theme was clear: the supply chains that will enable the first scientifically-relevant, fault tolerant quantum computer will not be the supply chains that ensure the long-term usefulness and commercialization of quantum technologies,” the analysts write. “America’s quantum leadership depends on our ability to build these supply chains in tandem.”

Quantum Components, Supply Chain Complications

The analysts identify a vulnerable layer of suppliers whose products make quantum computing, sensing and networking possible. Those businesses provide refrigeration, specialized materials, optical components, electronics and access to facilities that manufacture chips.

According to the analysts, this supporting layer receives less than 12% of federal quantum funding and attracts limited private capital, contributing to reliance on foreign suppliers and constrained production capacity.

The researchers added that quantum developers are using different approaches to process information — for example superconducting circuits or trapped ions — and their equipment and materials needs do not line up neatly. A component essential to one design may have little role in another. According to the analysts, this complicates supply chains even more.

Roundtable participants cautioned that a single, comprehensive supply chain map could therefore miss important requirements. They highlighted refrigeration, silicon-28, lasers, optical switches, technologies that use light and the need for skilled workers among the inputs that require attention.

According to the analysts, successful policy must support both greater output from existing suppliers and new production capacity in the United States and trusted allied countries. Installing a small number of advanced machines would not, by itself, establish an industrial base capable of serving growing demand.

The relevant test is whether suppliers can support continued research, manufacturing and deployment after the first systems arrive, according to the analysts.

AI Demand Is adding pressure

The analysts suggest the infrastructure buildout for advanced AI could be drawing resources and attention away from the quantum sector.

Roundtable participants reported that AI-related demand had already absorbed a large share of supplies sought by quantum developers, including chips that manipulate light, optical switches that minimize signal losses and high-quality fiber optics.

That creates a mixed outlook with heavy spending on AI infrastructure that encourages suppliers to expand and eventually increasing the availability of shared components. But the participants also raised concerns about the economic effects of insufficient demand, underscoring uncertainty over future demand from AI and quantum companies..

Other obstacles originate in government and the participants called out limited information sharing among federal agencies, creating the risk of overlapping investments or decisions based on outdated information. Uncoordinated state economic development efforts could compound those problems, the analysts report.

Unpredictable federal budgets add another constraint. Companies considering government programs or relying on grants face difficulty planning investments when Congress fails to complete budgets on time, according to the roundtable findings.

That uncertainty is particularly consequential for projects that require substantial upfront spending and several years to complete. It can constrain companies’ access to capital while limiting the government’s ability to make sustained investments, the analysts indicate.

Making Demand More Predictable

The experts proposed several strategies to deal with these challenges. The first proposed remedy is to make an advance market commitment, which is a pledge to purchase future output to give suppliers a clearer basis for investing in production.

The analysts recommend applying that approach to individual components as well as complete quantum systems. Pooling expected demand across companies into annual commitments could help manufacturers justify expansion and attract private investment.

They favor commitments aimed at production beginning within two to four years, with priority given, where possible, to inputs used across multiple quantum approaches.

According to the article, suggested targets include helium-3, silicon-28 and elements such as barium, ytterbium, erbium and praseodymium, along with fiber-optic cabling and other optical components. These recommendations reflect the range of materials and equipment the industry needs rather than a single standardized production process.

A second proposal calls for federal offices and financing authorities to coordinate investments in manufacturing capacity. The piece identifies the CHIPS research and development office, Office of Strategic Capital, Development Finance Corporation and Defense Production Act authorities among the potential channels.

The analysts recommend directing investment toward vulnerable inputs, using companies’ technical plans, existing industry analysis and government supply chain mapping to guide decisions.

They also urge policymakers to look beyond immediate shortages. Manufacturing methods, chip packaging and mineral processing may require investments whose usefulness emerges over seven to 10 years or longer. The analysts include support for algorithms — the instructions that make quantum computers perform useful tasks — in that longer-term agenda.

A Federal Buying Strategy

The analysts add that simply sharing more information about supply shortages among government agencies, companies and investors could be helpful. The analysts describe the Defense Advanced Research Projects Agency’s Quantum Benchmarking Initiative as holding the most complete dataset on supply chain constraints and opportunities, assembled through its evaluations of participating companies.

Sharing that information with other agencies and selected industry partners, particularly investors, could help direct capital toward production gaps, according to the analysts.

Another recommendation is for the National Quantum Strategy to provide guidance on federal purchases of multiple useful quantum computing systems. A clearer buying plan would give component manufacturers greater confidence that a market for their products will develop.

The analysts frame the strategy update, which they say is due in December under a June executive order, as an immediate opportunity to establish that demand signal. They also point to the federal goal of developing a scientifically relevant, fault-tolerant quantum computer by 2028. Fault tolerance means a machine can correct errors sufficiently to carry out reliable calculations.

The piece acknowledges that Washington has begun addressing manufacturing, citing Commerce Department investment commitments and a new National Institute of Standards and Technology center focused on quantum components and systems.

Its broader recommendation is to connect those efforts around identified shortages and longer-term production needs. Near-term component purchases, multiyear factory investments and eventual system acquisitions must reinforce one another if early quantum advances are to support a durable commercial industry, according to the analysts.

“With a 2028 deadline set, the next 18 months will fundamentally shape how U.S. corporations, researchers, and operators build and deploy quantum technologies,” the analysts write. “The federal government must therefore shape a cohesive effort to induce investment in chokepoints at the enabling layer and expand capacity.”