- The Biden administration is set to allocate over $6 billion to Samsung for expanding chip production in Texas, part of U.S. efforts to boost chip manufacturing.
- This investment aims to support the development of four facilities in Taylor, Texas, including a $17 billion chip manufacturing plant, doubling Samsung’s U.S. investment to over $44 billion.
- The move is part of a broader initiative to strengthen domestic chip production, reduce reliance on foreign manufacturers, and attract capital to the U.S. semiconductor industry.
The Biden administration is preparing to announce the allocation of more than $6 billion to South Korea’s Samsung next week, aimed at bolstering its chip production in Taylor, Texas, as part of efforts to enhance chip manufacturing in the U.S., according to two informed sources.
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It will support the development of four facilities in Taylor
The subsidy, to be disclosed by Commerce Department Secretary Gina Raimondo, will support the development of four facilities in Taylor, including a $17 billion chip manufacturing plant announced by Samsung in 2021, alongside another factory, an advanced packaging facility, and a research and development centre, as per one of the sources.
Additionally, it will involve an investment in another undisclosed location, with Samsung intending to more than double its U.S. investment to over $44 billion as part of the agreement. The Commerce Department and Samsung have declined to comment on the matter, while there has been no response from Texas Governor Greg Abbott’s office to requests for comment.
One of the sources mentioned that this would rank as the third-largest program, following Taiwan’s TSMC, which received $6.6 billion and agreed to expand its investment to $65 billion and add a third factory in Arizona by 2030.
The announcement comes amidst a series of significant grants under the Chips and Science initiative as the U.S. endeavours to boost domestic chip production and attract capital that might have otherwise been directed towards manufacturing plants in China and neighbouring regions.
The CHIPS Act aims to reduce dependence on China and Taiwan
The CHIPS Act, passed by Congress in 2022 with $52.7 billion in research and manufacturing subsidies, aims to reduce dependence on China and Taiwan, given that the U.S.’s share of global semiconductor manufacturing capacity declined from 37% in 1990 to 12% in 2020, according to the Semiconductor Industry Association.
Although President Joe Biden will not be in attendance, facing a challenging reelection bid against former President Donald Trump in November, Texas Governor Greg Abbott has been invited to the event, highlighting the political significance of Samsung’s expansion in reliably Republican Texas compared to TSMC and Intel’s expansion in the key swing state of Arizona.
