Samsung To Receive $6bn For Texas Chip Expansion

Samsung is expected to announce a US government grant of $6 billion (£4.7bn) to $7bn to expand its production capabilities in Texas at an event next week, according to a report by Reuters.

The grant under the US Chips and Science Act follows a $6.6bn award to Taiwan Semiconductor Manufacturing Co. on Monday and is expected to be the third-biggest grant announced so far.

Intel was awarded $8.5bn last month to expand its US production facilities, while GlobalFoundries in February received a smaller award of $1.5bn to build a new production facility in Malta, New York, as well as the expansion of an existing Malta plant and a Burlington manufacturing site.

The Wall Street Journal last week reported the Samsung grant, but did not include an estimate of the size of the award.

Texas expansion

The subsidy is to go toward four facilities in Taylor, Texas, near the capital of Austin, including a $17bn chip plant that Samsung announced in 2021, a second factory, an advanced packaging facility and a research and development centre, Reuters said.

It will also include investment into another undisclosed location. Samsung is expected to more than double its US investment to more than $44bn under the deal.

The Chips Act includes authority for $75bn in government loans, but Samsung is not planning to take loans, Reuters reported.

TSMC’s plan, announced on Monday, expands its investment in a site near Phoenix, Arizona, from $40bn to $65bn with plans to build a third factory by 2030 in addition to the two that are already under construction.

Domestic chip plan

Under that deal TSMC plans to introduce cutting-edge 2nm manufacturing technology to the second and third of the Arizona plants in the coming years.

The Samsung award is to be annouced by Commerce Secretary Gina Raimondo at an event in Taylor as US president Joe Biden prepares for a tough re-election fight in November.

The US share of semiconductor manufacturing fell from 37 percent in 1990 to 12 percent in 2020, according to the Semiconductor Industry Association.

The country currently makes no cutting-edge processors, but the Commerce Department has said it is on track to make 20 percent of them by 2030.