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The US government will award Samsung up to $6.4 billion in grants for its chip investments in the country. The funding comes under the CHIPS and Science Act and was announced by the Commerce Department on Monday. The Korean firm also plans to claim an investment tax credit from the US Treasury Department. The Biden administration previously announced multi-billion dollar grants for TSMC, Intel, and other chip firms.
Samsung gets $6.4 billion chip grant from the US government
In 2022, the Joe Biden-led US government established the CHIPS and Science Act to boost the domestic chip industry. The act encourages semiconductor companies to expand their production capacity in the country by constructing new manufacturing facilities. In return, they get various grants and subsidies from the government.
All major chip firms, including Samsung, TSMC, and Intel, have since announced new investments in the US. TSMC increased its investment from $40 billion to $65 billion. The Biden administration awarded the Taiwanese company with a grant of $6.6 billion. Intel, which plans to invest more than $100 billion in the US chip industry over the next five years, will get $8.5 billion in subsidies.
Samsung originally planned to invest $17 billion to construct a new chip factory in Taylor, Texas. This was announced in 2021 before the CHIPS and Science Act was passed. Various factors have since added to the cost. The company is now aiming to double the amount to $44 billion. It will construct another chip factory in Taylor and add a research center and a packaging facility to the site.
The Korean tech giant will also expand its existing chip plant in Austin, Texas. According to Commerce Department Secretary Gina Raimondo, Samsung’s investments will boost the country’s chip output for the aerospace, defense, and auto industries. “The proposed project will propel Texas into a state-of-the-art semiconductor ecosystem,” Raimondo said. “It puts us on track to hit our goal of producing 20% of the world’s leading-edge chips in the United States by the end of the decade.”
Samsung will create thousands of jobs in Texas
Raimondo estimates Samsung’s proposed investment projects in Texas to create more than 20,000 jobs. The Korean firm may create at least 17,000 construction jobs and 4,500 manufacturing jobs. Located in Williamson County, the road near Samsung’s semiconductor facility in Taylor was officially renamed “Samsung Highway” in December 2022. It was previously known as Future County Road.
“To meet the expected surge in demand from US customers, for future products like AI chips, our fabs will be equipped for cutting-edge process technologies and help bring security to the U.S. semiconductor supply chain,” said Samsung co-CEO Kyung Kye Hyun. The company expects to begin production in the new factories in 2026. It may start with 4nm chips before expanding into more advanced solutions—3nm and 2nm.
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